By Russ Britt, MarketWatch
LOS ANGELES (MarketWatch) — It takes a resilient economy to ride through the Great Recession — and it doesn’t hurt to have the world’s most powerful government in your backyard.
Both of those could apply only to Washington, D.C., as the nation’s capital rose to the very top of MarketWatch’s 2010 annual ranking of the Best Cities for Business, beating out such cities as Omaha, Neb., Boston and Des Moines, Iowa.
Washington has made the most out of having the U.S. government, a very large customer for any company, to keep it chugging during the tough times. But the region also has seen massive expansion in suburban towns in Virginia and Maryland over the years that has boosted its economy.
MARKETWATCH SPECIAL REPORT:BEST U.S. CITIES FOR BUSINESS THE TOP 10Washington, DC An ability to be resilient in tough times, aided by its proximity to the world’s most powerful government helped vault Washington D.C. to the top of MarketWatch’s 2010 list of U.S. “Best Cities for Business.”
“Washington’s been adding a tremendous number of jobs for a number of years,” said Kevin Klowden, a managing economist at the Milken Institute in Santa Monica, Calif. Klowden and other institute researchers recently performed their own study on the best cities for business and ranked Washington high on their list as well, sixth overall and tops among major metropolitan regions.
In the fourth year of doing the study, MarketWatch found cities that might have ranked higher in years past, but fell down the list as they continued to suffer the ill effects from the 2008 economic plunge. The strong truly survived, as those that performed well in the 2010 study proved their mettle under a rigorous test in a number of new categories.
The nation’s capital wasn’t at the very top of the class in MarketWatch’s study on how cities fared this past year, but Washington was solid in virtually all metrics checked and benefited from the addition of some new categories.
MarketWatch took a hard look at how cities have tried to contain their jobless rates in the past year and how they have done from the time the economic boom reached its apex in 2006 to today.
The statistics proved revealing and surprising, as a number of metro areas that normally would rank high in boom times such as Bridgeport, Conn., and San Jose, Calif., were well down the list because of low economic stability rankings. In fact, California did poorly in general, with six of its cities in the bottom 10.
How they scored Scores of all 102 cities in MarketWatch annual survey. Company score measures the concentration of businesses within a metro area according to several gauges. Economic score looks at a number of metrics, including unemployment, job growth, population growth, personal income and local GDP.
Here are the Top Ten:
Rank City TotalScore
1 Washington 1100
2 Omaha 1072
3 Boston 1071
4 Des Moines 1057
5 Minneapolis 997
6 Denver 980
7 Richmond 957
8 New York 950
9 Harrisburg 939
10 Seattle 932
Plus, the MarketWatch survey added four new metrics, bringing the total to 14. Part of that included an extra data point on unemployment and one on personal income growth, each of which are designed to give a better picture on how various regions have performed during the recession. There also were new metrics pertaining to regional GDPs, with a focus on tourism and military contributions to local economies.
Washington beat out 101 other cities for the honor, as MarketWatch looked at all metro areas with a population of 500,000 or more, ranging from New York to the smallest city included in the ranking, Durham-Chapel Hill, N.C. Durham is a new addition, having crossed the 500,000 threshold last year.
Here’s what they said about Richmond:
7. Richmond, Va. — 957 points: Richmond continues to reap the rewards of being in fairly close proximity to this year’s top finisher, Washington, D.C. After a one-year hiatus from the top 10 last year, Richmond came back to claim a spot once again.
Richmond boasts the best of both worlds; it’s about an hour and a half to metro Washington by car, yet it’s a lower-cost, relatively smaller city. When times are hard, it doesn’t necessarily feel the pain as much.
Richmond scored well, particularly in its concentration of S&P 500 companies. But it ranks low in tourism and personal income. While it has a large number of companies for its size, it didn’t have a particularly strong showing in creating jobs over the last year, or the last four years. Still, it’s unemployment rate over the last four years remained relatively low.
“We didn’t have as much of a recovery, but we didn’t have as much of a loss,” said Kim Scheeler, chief executive of the Richmond Chamber of Commerce
Kerry Riley
Kerry@kerryriley.com
One South Realty Group, Richmond VA
Richmond Real Estate
Monday, December 20, 2010
Friday, October 22, 2010
Mixed use project that would complete the Canal Walk in Downtown closer to reality
Developers who want to turn an industrial plant along Richmond’s Canal Walk into a mixed-use community are one step closer to their goal.
This is a repost of richmond bizsense article dated 10/22/2010
Partners Fountainhead Development and the WVS Companies had requested several changes to restrictive covenants put in place when the Canal Walk was developed in 1994. Those changes have now been endorsed by the executive committee of Venture Richmond, and director Jack Berry said he expects the full board to approve the changes within the month.
“There was unanimous agreement on the part of the developer, the city and Venture Richmond to make some changes in the convents to enhance the Canal Walk,” Berry said.
The developers, who have the six-acre site under contract, sought changes that would allow for taller buildings and some leeway in requirements that mandate pedestrian-oriented uses such as ground-level retail.
With the covenants changed, Fountainhead principal Rick Gregory said, it’s time to focus on financing. The purchase price for the site has not been disclosed.
The developers were granted a Special Use Permit by the city in July (read more here) that allowed for residential uses on the ground level, among other changes to the existing zoning.
Since then, the developers have continued negotiations with Venture Richmond on the covenant changes. The result is something in between what was granted in the SUP and the original covenants.
“There are a lot of different parties who have different agendas, and some people wanted more retail space,” Gregory said. “The point was there is already enough vacant space down there.”
The developers had wanted to use much of the street-level space for office or apartments, citing a lack of demand for retail. For the most part, provisions that require ground-level pedestrian uses such as shops and restaurants were kept intact.
“The requirements for first-floor pedestrian uses were retained and strengthened in certain instances,” Berry, of Venture Richmond, said.
The developer was relieved of this requirement on the first floor of a proposed residential building along the canal, which now will allow for commercial offices instead. The developer had been given permission by the city to place apartments on the ground level if they wanted, but in this case the covenants supersede the zoning.
The developers were also allowed to reduce pedestrian-oriented uses along 11th Street. In other sections, the current requirements were kept intact.
Among the other changes:
- Allow taller buildings in some sections.
- Protect river views from condo units in the Vistas above 70 feet.
- Strengthen and clarify existing covenants relating to architecture.
- Reduce setback from canal in some sections to allow larger building footprints.
Canal walk downtown richmond va; richmond real estate; kerry riley; one south realty group
This is a repost of richmond bizsense article dated 10/22/2010
Partners Fountainhead Development and the WVS Companies had requested several changes to restrictive covenants put in place when the Canal Walk was developed in 1994. Those changes have now been endorsed by the executive committee of Venture Richmond, and director Jack Berry said he expects the full board to approve the changes within the month.
“There was unanimous agreement on the part of the developer, the city and Venture Richmond to make some changes in the convents to enhance the Canal Walk,” Berry said.
The developers, who have the six-acre site under contract, sought changes that would allow for taller buildings and some leeway in requirements that mandate pedestrian-oriented uses such as ground-level retail.
With the covenants changed, Fountainhead principal Rick Gregory said, it’s time to focus on financing. The purchase price for the site has not been disclosed.
The developers were granted a Special Use Permit by the city in July (read more here) that allowed for residential uses on the ground level, among other changes to the existing zoning.
Since then, the developers have continued negotiations with Venture Richmond on the covenant changes. The result is something in between what was granted in the SUP and the original covenants.
“There are a lot of different parties who have different agendas, and some people wanted more retail space,” Gregory said. “The point was there is already enough vacant space down there.”
The developers had wanted to use much of the street-level space for office or apartments, citing a lack of demand for retail. For the most part, provisions that require ground-level pedestrian uses such as shops and restaurants were kept intact.
“The requirements for first-floor pedestrian uses were retained and strengthened in certain instances,” Berry, of Venture Richmond, said.
The developer was relieved of this requirement on the first floor of a proposed residential building along the canal, which now will allow for commercial offices instead. The developer had been given permission by the city to place apartments on the ground level if they wanted, but in this case the covenants supersede the zoning.
The developers were also allowed to reduce pedestrian-oriented uses along 11th Street. In other sections, the current requirements were kept intact.
Among the other changes:
- Allow taller buildings in some sections.
- Protect river views from condo units in the Vistas above 70 feet.
- Strengthen and clarify existing covenants relating to architecture.
- Reduce setback from canal in some sections to allow larger building footprints.
Canal walk downtown richmond va; richmond real estate; kerry riley; one south realty group
Thursday, October 21, 2010
Help from federal and state government to reclaim blighted houses in Richmond
A $5 million boost in the battle against blight for Richmond neighborhoods. This is a repost of a richmond bizsense article by Amy David .
House flipping is back, and this time local nonprofits want in on the game.
Richmond’s Neighborhood Stabilization Program recently received $5 million, its third infusion of funds from the Virginia Department of Housing and Community Development. The funds will be used to purchase, renovate and ultimately sell deserted and foreclosed properties in the Church Hill, Barton Heights and Highland Park areas
.
Renovations are underway on 20 properties and are expected to be complete within a few months. The upgraded properties will be sold or rented to people with low incomes.
“Our responsibility is to determine which areas have been impacted the most and rehab them to a livable and sellable state,” said Chris Thompson, program manager for the DHCD.
Funds for the stabilization program are made available through the Housing and Economic Recovery Act of 2008. The federal funding has been distributed to states, which have allocated it to localities to award to housing groups. The federal program is designed to reduce the effects on communities caused by the foreclosure crisis.
Many of the DHCD’s community development programs focus only on lower income households, but Thompson said Richmond’s program will cater to middle class households as well.
“The foreclosure crisis is hitting a broader spectrum of society, and [the stabilization program] can provide assistance to a variety of income groups,” Thompson said.
To date, 21 local government and nonprofit organizations have worked with the program to acquire and renovate foreclosed properties and sell them to potential homeowners. Richmond Metropolitan Habitat for Humanity, Bradley Development LLC, Richmond Redevelopment and Housing Authority and Southside Community Development and Housing Corporationare helping with the current renovations.
“We’ve purchased seven homes that have been foreclosed on,” said Dianna Herdon, executive director for Southside Community Development and Housing Corporation.
The community development nonprofit provides home-ownership education and counseling, home repairs and other financial support services to these first-time home buyers.
“We recently just sold our first home, located at 1805 Grove Avenue,” Herdon said.
About 70 homes have been purchased by grant recipients. Statewide, 35 houses have been sold out of 216 that have been renovated. Grantees design their own programs and funding criteria, but they must use at least a quarter of the funds toward the purchase of the property.
Kerry Riley, richmond real estate, one south realty group, house flipping, homes for sale.
House flipping is back, and this time local nonprofits want in on the game.
Richmond’s Neighborhood Stabilization Program recently received $5 million, its third infusion of funds from the Virginia Department of Housing and Community Development. The funds will be used to purchase, renovate and ultimately sell deserted and foreclosed properties in the Church Hill, Barton Heights and Highland Park areas
.
Renovations are underway on 20 properties and are expected to be complete within a few months. The upgraded properties will be sold or rented to people with low incomes.
“Our responsibility is to determine which areas have been impacted the most and rehab them to a livable and sellable state,” said Chris Thompson, program manager for the DHCD.
Funds for the stabilization program are made available through the Housing and Economic Recovery Act of 2008. The federal funding has been distributed to states, which have allocated it to localities to award to housing groups. The federal program is designed to reduce the effects on communities caused by the foreclosure crisis.
Many of the DHCD’s community development programs focus only on lower income households, but Thompson said Richmond’s program will cater to middle class households as well.
“The foreclosure crisis is hitting a broader spectrum of society, and [the stabilization program] can provide assistance to a variety of income groups,” Thompson said.
To date, 21 local government and nonprofit organizations have worked with the program to acquire and renovate foreclosed properties and sell them to potential homeowners. Richmond Metropolitan Habitat for Humanity, Bradley Development LLC, Richmond Redevelopment and Housing Authority and Southside Community Development and Housing Corporationare helping with the current renovations.
“We’ve purchased seven homes that have been foreclosed on,” said Dianna Herdon, executive director for Southside Community Development and Housing Corporation.
The community development nonprofit provides home-ownership education and counseling, home repairs and other financial support services to these first-time home buyers.
“We recently just sold our first home, located at 1805 Grove Avenue,” Herdon said.
About 70 homes have been purchased by grant recipients. Statewide, 35 houses have been sold out of 216 that have been renovated. Grantees design their own programs and funding criteria, but they must use at least a quarter of the funds toward the purchase of the property.
Kerry Riley, richmond real estate, one south realty group, house flipping, homes for sale.
Monday, September 27, 2010
Having First Fridays is a great free advertising tool for new business owners on Broad ST
Here's a re-post of a biz sense posting about three more new tenants to the Arts Corridor on Broad ST. This are is really getting traction as great and affordable retail corridor in the city.
The arts effect September 27, 2010 by Al Harris
A slew of new shops are opening in Richmond’s burgeoning arts district.
The stretch of Broad Street between Belvidere and First streets has been the home to the First Fridays Art Walk for several years, and retail stores are starting to follow in the footsteps of the galleries and restaurants that have helped revitalize the area.
Steady Sounds, a new record store, opened last week at 322 W. Broad St.
Drew Snyder, 32, parted ways with Carytown music store Plan 9 to launch his own business with musician Marty Key.
Snyder said the first week has gone well for the store, which sells new and used vinyl.
“The response has been really good, a lot of people just walking in. We are not really doing any advertising yet, just word of mouth,” Snyder said.
Another new shop to the area is the Spaghetti Project at 321 Brook Road inside the Emerick Flats building. The store, owned by Arlene Munoz and her husband, Edgar, sells collectible vinyl toys, books, clothing and other art.
Munoz opened the shop in Fredericksburg, where she lives, a year ago, and it didn’t quite take off. But now she says she has landed in the perfect spot, right in the middle of an active arts community.
“Everyone we met said, ‘You need to move to Richmond, because VCU is there and there is a lot of art going on,’” she said.
First made popular in Japan, designer vinyl toys are more pieces of art than playthings. Some of the more limited edition figures cost a few hundred bucks.
“I can foresee us doing good here. I met quite a few collectors already who can get their Dunnys here and don’t have to order online,” she said.
Dunny dolls are white vinyl figures that enthusiasts can color to create their own characters.
Also opening in the area is thrift store Books, Bikes and Beyond, which recently moved from its first location on Brookland Parkway to 7 W. Broad St. The nonprofit store sells donated goods to support Books on Wheels, a mobile library and bicycle repair shop.
Owner Sheley Briggs said she looked at about 20 locations before choosing where she is now.
“I liked the way Broad Street felt. Having First Friday brings business without doing advertising,” said Briggs.
She also said the price is right, too.“It is very affordable. The rates are amazing. My advice to anyone is to rent down here,” she said.
Another business has moved into the retail space at 11 E. Grace St., which has been vacant for nine years.Joe Herbi and two partners are running a gaming and Internet lounge called Pay II Play. Herbi said they charge between $5 and $7 an hour for people to come and play all the games they want.
And finally, coming soon to the space vacated by clothing store the Henry Gallery is 212 Tattoo. The tattoo parlor has filed for a business permit to operate at that location.
Kerry Riley, Richmond Real Estate, Downtown Arts Corridor, First Friday Artwalk
The arts effect September 27, 2010 by Al Harris
A slew of new shops are opening in Richmond’s burgeoning arts district.
The stretch of Broad Street between Belvidere and First streets has been the home to the First Fridays Art Walk for several years, and retail stores are starting to follow in the footsteps of the galleries and restaurants that have helped revitalize the area.
Steady Sounds, a new record store, opened last week at 322 W. Broad St.
Drew Snyder, 32, parted ways with Carytown music store Plan 9 to launch his own business with musician Marty Key.
Snyder said the first week has gone well for the store, which sells new and used vinyl.
“The response has been really good, a lot of people just walking in. We are not really doing any advertising yet, just word of mouth,” Snyder said.
Another new shop to the area is the Spaghetti Project at 321 Brook Road inside the Emerick Flats building. The store, owned by Arlene Munoz and her husband, Edgar, sells collectible vinyl toys, books, clothing and other art.
Munoz opened the shop in Fredericksburg, where she lives, a year ago, and it didn’t quite take off. But now she says she has landed in the perfect spot, right in the middle of an active arts community.
“Everyone we met said, ‘You need to move to Richmond, because VCU is there and there is a lot of art going on,’” she said.
First made popular in Japan, designer vinyl toys are more pieces of art than playthings. Some of the more limited edition figures cost a few hundred bucks.
“I can foresee us doing good here. I met quite a few collectors already who can get their Dunnys here and don’t have to order online,” she said.
Dunny dolls are white vinyl figures that enthusiasts can color to create their own characters.
Also opening in the area is thrift store Books, Bikes and Beyond, which recently moved from its first location on Brookland Parkway to 7 W. Broad St. The nonprofit store sells donated goods to support Books on Wheels, a mobile library and bicycle repair shop.
Owner Sheley Briggs said she looked at about 20 locations before choosing where she is now.
“I liked the way Broad Street felt. Having First Friday brings business without doing advertising,” said Briggs.
She also said the price is right, too.“It is very affordable. The rates are amazing. My advice to anyone is to rent down here,” she said.
Another business has moved into the retail space at 11 E. Grace St., which has been vacant for nine years.Joe Herbi and two partners are running a gaming and Internet lounge called Pay II Play. Herbi said they charge between $5 and $7 an hour for people to come and play all the games they want.
And finally, coming soon to the space vacated by clothing store the Henry Gallery is 212 Tattoo. The tattoo parlor has filed for a business permit to operate at that location.
Kerry Riley, Richmond Real Estate, Downtown Arts Corridor, First Friday Artwalk
Tuesday, September 21, 2010
News from meeting at Carillon re: bike ways and trails in City
This is a repost from James River News Hub:
Rethink our streets: Bike, pedestrian & trails commission
Posted on September 20, 2010 by Phil Riggan 3 Comments
It is good to see the city recognising the equity in planning for pedestrians and cyclists and not just for vehicles and public transit.
What I observed Monday night at The Carillon in Byrd Park was a room of nearly 200 people — fit, energetic, enthusiastic people who didn’t want to sit around and talk, they wanted to get work started and get things done.
“Rethink our streets” was a focus – planning our streetscapes so that everyone can use the roadways. The Bike, Pedestrian and Trails workgroup was tasked with creating a policy framework conducive to making Richmond a walkable, bikeable, trail-friendly city through networks of greenways that would safely connect neighborhoods, shopping districts, colleges, the James River, etc. Reworking traffic patterns on key neighborhood connectors like the Martin Luther King, Mayo, Manchester and Robert E. Lee bridges downtown.
City of Richmond trails manager, Nathan Burrell, said that many people may not have the ability or means to commute by vehicle. Developing greenways, “this is empowerment. A city that you would want to live in.” Allowing people to get off the couches and outside and connecting with each other.
Burrell declared that “we are a trail and cycling friendly town” and that Mayor Dwight Jones “moved fairly aggressively with the timeline for trail building and greenways plans.”
Thanks to trail-building groups like Richmond-MORE, many mountain bike trails are in place and have come almost entirely free to the city. The goal is allow that work to continue and to help establish bike-only roadway connections between the parks. There are short-term and long-term plan.
Existing trails: James River Park System trails at Pony Pasture, Buttermilk, North Bank and Belle Isle; Powhite Park; Forest Hill Park; Lombardy Street; Ironbridge Road; and Capital Trail along Dock Street.
Planned for next 1-2 years: Establish East/West major route (following Main and Leigh streets); North/South major route (following Hermitage, Boulevard, Belt and Iron Bridge roads); Major Bike Route Connecting Loop. Build trails at Dogwood Dell, Chapel Island and Bandy Field and a Buttermilk West expansion toward the Powhite Parkway Bridge. Establish greenways from Reedy Creek, Cannon Creek, Gillies Creek. Would also post signage along existing bike paths along Brookland Parkway and Semmes Avenue.
Planned for next 2-5 years: Establishing greenways from Pumphouse, Powhite Creek, James River Branch, Pocosham Creek, Manchester Wall to 22nd Street Tower (Missing Link trail) and creating Crooked Branch Park trails. Virginia Capital Trail is scheduled to be finished. Plans include water taxi in Kanawha Canal from Tredegar to Pumphouse Park.
Recommend policies to promote alternative transportation modes for commuters:
1)Incent employees to use alternate transportation
2)Promote bike racks at offices & public buildings
3)Offer incentives for workplace showers and lockers
4)Incentives for using mass transit
5)Educate employers and citizens on existing tax credits
6)Investigate feasibility of Zip cars and bike share programs
Jennifer Wampler of the Department of Conservation and Recreation said “Richmond is a trail town” and suggested that the money spent on developing plans around physical activity is found to have a better return on investment. Bike and pedestrian trails could have a huge positive impact on tourism, with healthy economic benefits and help change our culture.
There was a proposal to create a full-time bike, pedestrian and trail coordinator position for the City of Richmond who would be responsible for implementing recommendations & coordinating departments. That position would be key as Richmond also plans to connect with the East Coast Greenway, which runs through from Maine to Key West, Fla., and draws people from around the world.
Champe Burnley, president of the Virginia Bicycling Federation, pointed out that “there are so many great parks in the Richmond area.” The two major bike routes (Route 1 and Route 76), that opens up “an incredible opportunity that would run through Richmond.”
While he was speaking, Burnley said that he “hoped that city council would get behind us” in the direction of city councilman Doug Conner of the South Central 9th District, who replied aloud “we’re going to do that.” Conner has already been involved with greenways, helping a rails-to-trails project effort to convert a former CSX railroad bed that runs 2.5 miles between Belt Boulevard and Hopkins Road.
Burnley encouraged the crowd to go to http://bit.ly/RVA-Ped-Bike-Trail-Survey to express their opinions and http://bit.ly/MPOBikePlan for more information.
Reposted by Kerry Riley. Kerry@kerryriley.com. www.kerryriley.com. Riley Real Estate of Richmond.
Rethink our streets: Bike, pedestrian & trails commission
Posted on September 20, 2010 by Phil Riggan 3 Comments
It is good to see the city recognising the equity in planning for pedestrians and cyclists and not just for vehicles and public transit.
What I observed Monday night at The Carillon in Byrd Park was a room of nearly 200 people — fit, energetic, enthusiastic people who didn’t want to sit around and talk, they wanted to get work started and get things done.
“Rethink our streets” was a focus – planning our streetscapes so that everyone can use the roadways. The Bike, Pedestrian and Trails workgroup was tasked with creating a policy framework conducive to making Richmond a walkable, bikeable, trail-friendly city through networks of greenways that would safely connect neighborhoods, shopping districts, colleges, the James River, etc. Reworking traffic patterns on key neighborhood connectors like the Martin Luther King, Mayo, Manchester and Robert E. Lee bridges downtown.
City of Richmond trails manager, Nathan Burrell, said that many people may not have the ability or means to commute by vehicle. Developing greenways, “this is empowerment. A city that you would want to live in.” Allowing people to get off the couches and outside and connecting with each other.
Burrell declared that “we are a trail and cycling friendly town” and that Mayor Dwight Jones “moved fairly aggressively with the timeline for trail building and greenways plans.”
Thanks to trail-building groups like Richmond-MORE, many mountain bike trails are in place and have come almost entirely free to the city. The goal is allow that work to continue and to help establish bike-only roadway connections between the parks. There are short-term and long-term plan.
Existing trails: James River Park System trails at Pony Pasture, Buttermilk, North Bank and Belle Isle; Powhite Park; Forest Hill Park; Lombardy Street; Ironbridge Road; and Capital Trail along Dock Street.
Planned for next 1-2 years: Establish East/West major route (following Main and Leigh streets); North/South major route (following Hermitage, Boulevard, Belt and Iron Bridge roads); Major Bike Route Connecting Loop. Build trails at Dogwood Dell, Chapel Island and Bandy Field and a Buttermilk West expansion toward the Powhite Parkway Bridge. Establish greenways from Reedy Creek, Cannon Creek, Gillies Creek. Would also post signage along existing bike paths along Brookland Parkway and Semmes Avenue.
Planned for next 2-5 years: Establishing greenways from Pumphouse, Powhite Creek, James River Branch, Pocosham Creek, Manchester Wall to 22nd Street Tower (Missing Link trail) and creating Crooked Branch Park trails. Virginia Capital Trail is scheduled to be finished. Plans include water taxi in Kanawha Canal from Tredegar to Pumphouse Park.
Recommend policies to promote alternative transportation modes for commuters:
1)Incent employees to use alternate transportation
2)Promote bike racks at offices & public buildings
3)Offer incentives for workplace showers and lockers
4)Incentives for using mass transit
5)Educate employers and citizens on existing tax credits
6)Investigate feasibility of Zip cars and bike share programs
Jennifer Wampler of the Department of Conservation and Recreation said “Richmond is a trail town” and suggested that the money spent on developing plans around physical activity is found to have a better return on investment. Bike and pedestrian trails could have a huge positive impact on tourism, with healthy economic benefits and help change our culture.
There was a proposal to create a full-time bike, pedestrian and trail coordinator position for the City of Richmond who would be responsible for implementing recommendations & coordinating departments. That position would be key as Richmond also plans to connect with the East Coast Greenway, which runs through from Maine to Key West, Fla., and draws people from around the world.
Champe Burnley, president of the Virginia Bicycling Federation, pointed out that “there are so many great parks in the Richmond area.” The two major bike routes (Route 1 and Route 76), that opens up “an incredible opportunity that would run through Richmond.”
While he was speaking, Burnley said that he “hoped that city council would get behind us” in the direction of city councilman Doug Conner of the South Central 9th District, who replied aloud “we’re going to do that.” Conner has already been involved with greenways, helping a rails-to-trails project effort to convert a former CSX railroad bed that runs 2.5 miles between Belt Boulevard and Hopkins Road.
Burnley encouraged the crowd to go to http://bit.ly/RVA-Ped-Bike-Trail-Survey to express their opinions and http://bit.ly/MPOBikePlan for more information.
Reposted by Kerry Riley. Kerry@kerryriley.com. www.kerryriley.com. Riley Real Estate of Richmond.
Wednesday, September 8, 2010
Student housing amoung one of the growth industries in Richmond along with some suprises
This is a reprint from Richmondbizsense.com's news feed. Since I am so active in real estate in Richmond's Fan district I have experienced first hand the uptick in student housing needs at VCU. I have sold three city apartment buildings in the past month and continue to help others in this growing sector of the market.
Richmond’s fastest growing industries:
September 7, 2010 by Al Harris
The economy may be stuck in a funk, but plenty of Richmonders are finding ways to entice customers with new products or services, especially in these seven industries:
Tattoos:
You don’t need to know the results of a recent study to know that Richmond is a city seeped in ink. Richmond has 14.5 shops per 100,000 people, coming in third in the nation. And it shows. The neon glow of the neighborhood tattoo parlor is a staple of most neighborhoods inside the city. And even stodgy Chesterfield County recently approved the county’s first tattoo parlor.
Pets:
You know you live in a pet friendly city when restaurants have dog bowls outside for passing canines. And Richmond has most definitely gone to the dogs. One of the first to find this rapidly growing niche was Premier Pet Products which started making a special leash decades ago and continues hiring more employees as it expands its line of humane pet products. And then there’s Bully Sticks, a locally-based maker and distributor of dog treats. They’re also hiring. Plus there’s WholesalePets.com distributing inventory to thousands of pet boutiques around the country. And of course, Zoomer Gear selling motorcycle helmets online. Richmond also has eclectic assortment of retail stores, groomers, and daycares that cater to local pet owners as well.
Student Housing:
Students are economic stimulus gold. As VCU expands, so has the need for student housing — and business is a booming. The medical school keeps Shockoe Bottom stocked with renters, and several major projects are underway with hundreds of units coming over the next year or two, mostly in renovated industrial buildings. On the other side of campus Gilbane is constructing a new mid-rise near the new VCU Brandcenter and School of Business building. Two new apartment buildings recently went up on Belvedere south of Main Street.
Local Food:
It seems you can’t go to a restaurant these days without the menu touting the proximity of its ingredients. And Richmonders are eating it up. Several farmers’ markets have cropped up in the last few years and each year get even bigger. They’ve even gone mobile, like Mark Lily’s Farm to Family market which travels around town in a converted school bus. Others like Dominion Harvest and Relay Foods have similar models delivering fresh local food. Still other entrepreneurs, like Backyard Farmer and United States of Food have businesses that are based on bringing customers the most local food possible — the kind you grow in your backyard garden.
Sports:
Richmond is a sports town. Just try to drive through the Fan during the Monument 10K. There is a cottage industry here keeping all those gym rats lean and mean. From solo entrepreneurs who scream, “Give me 20 more pushups” in parks around town, to small, specialized gyms like Fitness Together and CrossFit, to the homegrown big gyms like American Family Fitness, working out is big business. As if that wasn’t enough Chesterfield-based SportsQuest is covering major acreage with artificial turf in the first phase of a proposed sports Mecca. Putting on events is a growth biz, too. SportsBackers has been adding at least one new event for the last few years, and the popularity of its races grows every year. Richmond has plenty for spectators as well such as the Richmond Kickers, River City Rollergirls women’s roller derby, two arena football teams. And don’t forget Flying Squirrels adding minor league baseball at the Diamond. Plus, the University of Richmond finally has an on-campus football stadium, and season ticket sales have doubled to 4,000 in three years.
Specialty Insurance:
It’s obscure, and let’s be honest, not as flashy or fun as an the latest electric car, but Richmond has a huge and growing presence of specialty insurance firms, which write policies for things like medical malpractice for doctors. The newest entrant is Kinsale, (You can read about it here). And earlier this decade one opened here called James River. Plus there are some of the industries big boys Colony, Max Specialty and of course, Markel, which has been expanding by buying companies around the world. And don’t forget Monument Sports, a local firm that sells policies all over the country on sporting facilities like soccer bubbles.
Booze:
Richmond isn’t the drunkest city, thankfully, but booze is a growth industry. We already had Cirrus Vodka distilled on the Southside, and this summer Reservoir Whiskey opened. Plus there is Legend beer, which finally sells six-packs of bottles in local grocery stores. Don’t forget an explosion of wine bars as well. And of course, Governor McDonnell wants to privatize liquor sales, which means that there could be a lot more stores and cheaper prices.
Kerry Riley. Kerry@kerryriley.com. http://www.kerryriley.com/
Richmond’s fastest growing industries:
September 7, 2010 by Al Harris
The economy may be stuck in a funk, but plenty of Richmonders are finding ways to entice customers with new products or services, especially in these seven industries:
Tattoos:
You don’t need to know the results of a recent study to know that Richmond is a city seeped in ink. Richmond has 14.5 shops per 100,000 people, coming in third in the nation. And it shows. The neon glow of the neighborhood tattoo parlor is a staple of most neighborhoods inside the city. And even stodgy Chesterfield County recently approved the county’s first tattoo parlor.
Pets:
You know you live in a pet friendly city when restaurants have dog bowls outside for passing canines. And Richmond has most definitely gone to the dogs. One of the first to find this rapidly growing niche was Premier Pet Products which started making a special leash decades ago and continues hiring more employees as it expands its line of humane pet products. And then there’s Bully Sticks, a locally-based maker and distributor of dog treats. They’re also hiring. Plus there’s WholesalePets.com distributing inventory to thousands of pet boutiques around the country. And of course, Zoomer Gear selling motorcycle helmets online. Richmond also has eclectic assortment of retail stores, groomers, and daycares that cater to local pet owners as well.
Student Housing:
Students are economic stimulus gold. As VCU expands, so has the need for student housing — and business is a booming. The medical school keeps Shockoe Bottom stocked with renters, and several major projects are underway with hundreds of units coming over the next year or two, mostly in renovated industrial buildings. On the other side of campus Gilbane is constructing a new mid-rise near the new VCU Brandcenter and School of Business building. Two new apartment buildings recently went up on Belvedere south of Main Street.
Local Food:
It seems you can’t go to a restaurant these days without the menu touting the proximity of its ingredients. And Richmonders are eating it up. Several farmers’ markets have cropped up in the last few years and each year get even bigger. They’ve even gone mobile, like Mark Lily’s Farm to Family market which travels around town in a converted school bus. Others like Dominion Harvest and Relay Foods have similar models delivering fresh local food. Still other entrepreneurs, like Backyard Farmer and United States of Food have businesses that are based on bringing customers the most local food possible — the kind you grow in your backyard garden.
Sports:
Richmond is a sports town. Just try to drive through the Fan during the Monument 10K. There is a cottage industry here keeping all those gym rats lean and mean. From solo entrepreneurs who scream, “Give me 20 more pushups” in parks around town, to small, specialized gyms like Fitness Together and CrossFit, to the homegrown big gyms like American Family Fitness, working out is big business. As if that wasn’t enough Chesterfield-based SportsQuest is covering major acreage with artificial turf in the first phase of a proposed sports Mecca. Putting on events is a growth biz, too. SportsBackers has been adding at least one new event for the last few years, and the popularity of its races grows every year. Richmond has plenty for spectators as well such as the Richmond Kickers, River City Rollergirls women’s roller derby, two arena football teams. And don’t forget Flying Squirrels adding minor league baseball at the Diamond. Plus, the University of Richmond finally has an on-campus football stadium, and season ticket sales have doubled to 4,000 in three years.
Specialty Insurance:
It’s obscure, and let’s be honest, not as flashy or fun as an the latest electric car, but Richmond has a huge and growing presence of specialty insurance firms, which write policies for things like medical malpractice for doctors. The newest entrant is Kinsale, (You can read about it here). And earlier this decade one opened here called James River. Plus there are some of the industries big boys Colony, Max Specialty and of course, Markel, which has been expanding by buying companies around the world. And don’t forget Monument Sports, a local firm that sells policies all over the country on sporting facilities like soccer bubbles.
Booze:
Richmond isn’t the drunkest city, thankfully, but booze is a growth industry. We already had Cirrus Vodka distilled on the Southside, and this summer Reservoir Whiskey opened. Plus there is Legend beer, which finally sells six-packs of bottles in local grocery stores. Don’t forget an explosion of wine bars as well. And of course, Governor McDonnell wants to privatize liquor sales, which means that there could be a lot more stores and cheaper prices.
Kerry Riley. Kerry@kerryriley.com. http://www.kerryriley.com/
Monday, August 23, 2010
Lots of abandoned homes in Richmond
By Carol Hazard TIMES-DISPATCH STAFF WRITERPublished: August 21, 2010
About 800 properties in the city of Richmond are vacant and uninhabitable.
An additional 800 could be lived in but need work. And 800 other vacant properties are in good condition, said Rachel O. Flynn, director of planning and development for Richmond.
In all, the city is dealing with about 2,400 vacant properties, said Flynn, who spoke yesterday during a presentation at the Federal Reserve Bank of Richmond.
More than 100 city leaders, representatives from nonprofit and civic groups, and real estate agents gathered for the session on "Turning Around Vacant Properties in Greater Richmond."
Neglectful property owners can be cited for blight and be required to submit plans to the city to fix the problems. If they do not improve the properties, the city can take possession through court procedures.
Take, for example, 106½ E. Clay St. The owner refused to comply with code enforcement and would not sell it to the city. The city petitioned the court to have the property condemned and took possession.
The Alliance to Conserve Old Richmond Neighborhoods, a nonprofit housing group, bought the property from the city for $67,459, then sold it contingent upon a development agreement for essentially the same amount to a developer.
The city also can take over properties if taxes are not paid.
The process is lengthy and cumbersome, speakers at yesterday's session said. The event was presented by the Richmond Fed, Virginia Local Initiative Support Corp. and the Partnership for Housing Affordability.
Sometimes owners are cooperative but they have no money to fix their properties or there is no market to sell them. In some cases, the government can intervene with subsidies, Flynn said.
It's important to create neighborhoods that can survive on their own without government subsidies, where private industry sees possibilities and makes investments, she said.
Richmond's problem with blight has escalated since 1949, when trolleys were removed and people became dependent on automobiles. Many abandoned the city for the suburbs.
"This is what it looked like 100 years ago," said Flynn, pointing to a photo of a vibrant downtown with sidewalks teeming with people and a trolley running down the center of Broad Street.
"There is no reason we can't have that today," she said, noting the link between public transit and neighborhood revitalization.
Greg Lukanuski, assistant city attorney, said building codes do a good job of getting property owners motivated to fix dilapidated structures. However, some people do not have the physical, financial or mental wherewithal to deal with the changes.
If the city takes an elderly woman to court for blight, most of the time the family comes to the rescue and corrects the problems, Lukanuski said. Still, it makes for an uncomfortable situation.
Often, the homeowner's sole source of income is Social Security benefits, which gives the person money to cover food, utilities and taxes but not enough for maintenance.
Property owners must be given notice of a violation and time to fix it, before a court summons is issued and the city can move to take over properties, Lukanuski said.
Some slumlords are good at ducking code-enforcement inspectors, he said. They might get lots of notices of violations, but they never go to court because they can't be found, Lukanuski said.
Bonnie Ashley, senior assistant attorney for the city, said a property with taxes that haven't been paid for a year and a half could be taken to public auction in nine or 10 months under the best and fastest scenario.
It's typically a two-year process, but it can take longer, she said.
Take, for example, a 100-year-old house that was maintained by the original owners. Generations of heirs inherit the property, and each person owns a small portion. The problem often is getting someone to step up, pay the taxes and take control, she said.
Re-print to Kerry Riley's blog August 23, 2010
About 800 properties in the city of Richmond are vacant and uninhabitable.
An additional 800 could be lived in but need work. And 800 other vacant properties are in good condition, said Rachel O. Flynn, director of planning and development for Richmond.
In all, the city is dealing with about 2,400 vacant properties, said Flynn, who spoke yesterday during a presentation at the Federal Reserve Bank of Richmond.
More than 100 city leaders, representatives from nonprofit and civic groups, and real estate agents gathered for the session on "Turning Around Vacant Properties in Greater Richmond."
Neglectful property owners can be cited for blight and be required to submit plans to the city to fix the problems. If they do not improve the properties, the city can take possession through court procedures.
Take, for example, 106½ E. Clay St. The owner refused to comply with code enforcement and would not sell it to the city. The city petitioned the court to have the property condemned and took possession.
The Alliance to Conserve Old Richmond Neighborhoods, a nonprofit housing group, bought the property from the city for $67,459, then sold it contingent upon a development agreement for essentially the same amount to a developer.
The city also can take over properties if taxes are not paid.
The process is lengthy and cumbersome, speakers at yesterday's session said. The event was presented by the Richmond Fed, Virginia Local Initiative Support Corp. and the Partnership for Housing Affordability.
Sometimes owners are cooperative but they have no money to fix their properties or there is no market to sell them. In some cases, the government can intervene with subsidies, Flynn said.
It's important to create neighborhoods that can survive on their own without government subsidies, where private industry sees possibilities and makes investments, she said.
Richmond's problem with blight has escalated since 1949, when trolleys were removed and people became dependent on automobiles. Many abandoned the city for the suburbs.
"This is what it looked like 100 years ago," said Flynn, pointing to a photo of a vibrant downtown with sidewalks teeming with people and a trolley running down the center of Broad Street.
"There is no reason we can't have that today," she said, noting the link between public transit and neighborhood revitalization.
Greg Lukanuski, assistant city attorney, said building codes do a good job of getting property owners motivated to fix dilapidated structures. However, some people do not have the physical, financial or mental wherewithal to deal with the changes.
If the city takes an elderly woman to court for blight, most of the time the family comes to the rescue and corrects the problems, Lukanuski said. Still, it makes for an uncomfortable situation.
Often, the homeowner's sole source of income is Social Security benefits, which gives the person money to cover food, utilities and taxes but not enough for maintenance.
Property owners must be given notice of a violation and time to fix it, before a court summons is issued and the city can move to take over properties, Lukanuski said.
Some slumlords are good at ducking code-enforcement inspectors, he said. They might get lots of notices of violations, but they never go to court because they can't be found, Lukanuski said.
Bonnie Ashley, senior assistant attorney for the city, said a property with taxes that haven't been paid for a year and a half could be taken to public auction in nine or 10 months under the best and fastest scenario.
It's typically a two-year process, but it can take longer, she said.
Take, for example, a 100-year-old house that was maintained by the original owners. Generations of heirs inherit the property, and each person owns a small portion. The problem often is getting someone to step up, pay the taxes and take control, she said.
Re-print to Kerry Riley's blog August 23, 2010
Thursday, August 5, 2010
Yikes! Richmond Developer may be headed for the Big House
FBI, IRS raid French office
August 5, 2010 by Aaron Kremer
Officers from the FBI and IRS raided the Shockoe Slip offices of embattled developer Justin French this morning.
The FBI’s Richmond office would not say why, only confirming that agents are there. RBS’s reporter on the scene said law enforcement entered French’s office near 13th and Cary Streets with empty boxes, presumably to gather documents. State troopers were also present.
It may have to do with French’s use of historic tax credits on his developments, which involve converting former industrial buildings into residences and selling federal tax credits to investors.
Several partners who worked with French on various aspects of the historic tax credit deals said they did not know he was under investigation.
French is not at the office.
Stay with RBS for more as this story develops.
August 5, 2010 by Aaron Kremer
Officers from the FBI and IRS raided the Shockoe Slip offices of embattled developer Justin French this morning.
The FBI’s Richmond office would not say why, only confirming that agents are there. RBS’s reporter on the scene said law enforcement entered French’s office near 13th and Cary Streets with empty boxes, presumably to gather documents. State troopers were also present.
It may have to do with French’s use of historic tax credits on his developments, which involve converting former industrial buildings into residences and selling federal tax credits to investors.
Several partners who worked with French on various aspects of the historic tax credit deals said they did not know he was under investigation.
French is not at the office.
Stay with RBS for more as this story develops.
Monday, August 2, 2010
Richmond Real Estate Merry Go Round - Massive Foreclosure of Justin French's empire
This is a re-print of an article in Sunday's Richmond Times Dispatch about local developer Justin French and a massive foreclosure in the works for some prime City of Richmond multi-family properties.
Developer Justin G. French, 39, is in the midst of a battle royal with a giant specialty insurer in Henrico County and five local banks.
By Carol Hazard TIMES-DISPATCH STAFF WRITERPublished: August 01, 2010
Developer Justin G. French went from declaring bankruptcy days after leaving federal prison to dealing in millions of dollars in Richmond properties.During French's 13 years in Richmond, his business associations have included Donald C. Lacey, who pleaded guilty this year to a real estate Ponzi scheme, and some of the area's biggest financial players.
French, 39, is in the midst of a battle royal with a giant specialty insurer in Henrico County and five local banks scrambling to salvage tens of millions of dollars that they lent to him on 14 real estate projects. All the loans are in default.
Last week, Richmond-based Union First Market Bank was granted court permission for a receiver to manage and control six entities involving eight properties and recover $14.2 million in loans guaranteed by French. And Hampton Roads Bankshares Inc. in Norfolk is investigating $19 million that it agreed to lend to French for two unfinished apartment conversions, also in default, in Richmond's Scott's Addition, just west of Boulevard.
French blames his problems on Markel Corp., an insurer and business partner on historic tax credit projects, for withholding $3 million and leading him to the unusual step of asking the banks to foreclose on his own properties. Markel has not responded to repeated calls and e-mails for comment.
French, through several companies, owns more than 100 properties in the city, according to the assessor's office. Most are in the inner-city core, where he has played an important role revitalizing once-decaying neighborhoods."He has been one of the urban pioneers to revitalize Richmond and bring much-needed housing for a variety of citizens from young urban professionals to empty nesters," said Rachel O. Flynn, director of planning and development review for the city.
One of his latest projects is an $11 million conversion of a former Philip Morris USA plant in the Manchester section into 225 residential units. "It's very simple, very tasteful," Flynn said.
But French's tactic of using historic tax credits to offset renovation costs has hit a roadblock.
"We have a substantial number of applications from French that we have been unable to act on because of ongoing questions about the expenses claimed," said Kathleen Kilpatrick, director of the state Department of Historic Resources.
"We look at whether the work has been completed in accordance with appropriate preservation standards. We look at whether the line item is an eligible expenditure. We also look at the expenditures themselves, whether the expense claimed is in line with what we would expect to see."
She declined to say how many of his tax-credit applications are in limbo.
. . .
French says he came to Richmond in 1997.
In 1994, while a student at the George Mason University School of Law, French and another man were charged with conspiracy to possess with intent to distribute cocaine and aiding and abetting the use of firearms in relation to a drug-trafficking crime.
He pleaded guilty in a plea bargain and was sentenced to five years on each of the two counts in 1994.
He was released from federal prison in August 1996.
"On the case you reference 16 years ago, I was set up and entangled in a conspiracy charge," French said. "I regret that I allowed myself to be connected to people the authorities had targeted. But I fully cooperated with authorities, and I am proud of what I have done in life since that mistake."
French filed for bankruptcy protection in U.S. Bankruptcy Court in Richmond two days after his release from prison. Eleven months later, in July 1997, he signed on as a loan officer with Westover Investment Corp. He was attracted there, he said in a filing in Richmond Circuit Court, by the company's promise that it had a good system of referrals for customers. By late winter, he quit.
Westover complained he wouldn't return files and records when it sued for $20,000 and a court order to enforce an employment contract with a noncompete clause. French and the company settled out of court.French stayed in the real estate business, doing hundreds of deals.
In 2003, seven years after filing for bankruptcy, he bought a Georgian mansion in Richmond's West End for $1.8 million. It now is assessed at $2 million.
"I have worked hard, saved and sacrificed to earn everything I have ever owned in life," French said.
French and his wife, Tanya, hosted a benefit in their home, called Westbourne, for the Richmond Symphony in 2005. They reigned as king and queen for the Mardi Gras party, and guests wore beads, masks, crowns and costumes.
He is a former member of the boards of Junior Achievement of Central Virginia and The Faison School for Autism. The website for his business, French Consulting Co., said he is a member of the Kiwanis Club of Richmond, Kinlock Golf Club and The Country Club of Virginia.
His real estate agent was Lacey. French was a business associate with Lacey in limited liability companies, including MJD Properties, and he has ties to another Lacey company, Capital Funding & Consulting in Henrico.Lacey, who will be sentenced Tuesday for his role in the Ponzi scheme, solicited money from investors through Capital Funding & Consulting.
The money was supposed to be used to buy fixer-uppers in Richmond and flip them for a profit. But in most cases, the work never was done, and money was moved from one property to another in a complex money trail.
Lacey no longer is involved in Capital Funding & Consulting. However, the company is a beneficiary of a deed of trust on a property owned by French, according to a lawsuit filed July 15 by Union First Market Bank against entities in the foreclosure process owned by French.
In a lawsuit filed last year, one of Lacey's investors, Allan Mullian, alleges that French was one of several people in addition to Lacey and MJD who guaranteed a $52,000 note.
French has sought to distance himself from Lacey. In a Richmond Circuit Court filing, he said Lacey promised French and French's wife, along with other principals in MJD, that Lacey would indemnify them against any losses or liabilities from the company's dealings.
"I have had no dealings with Lacey, other than being a victim, like so many others," French said.
He said he was in partnerships with Lacey more than five years ago and he guaranteed some old notes.
"I have been successful in restructuring them, and all payments are current," French said. "Many of the properties have sold or are under contract currently. To a large extent, I am one of the only people that have protected the other victims, at great personal expense to myself."
Joel Fine from the Asheville, N.C., area said French has restructured seven of 12 notes that French along with Lacey and others personally guaranteed. French is making monthly payments on those new notes.
"Justin, from the get-go, has never tried to duck his responsibilities," Fine said.
Still, the legal wrangling continues. Two foreclosed properties guaranteed by French were repossessed, but they haven't closed or settled. Three are encumbered with old judgments, and Fine can't get clear titles.
In all, Fine and his family invested $750,000 through Old Dominion Financial Services Inc., a now-defunct company in Henrico that funneled money to companies involving French and Lacey. The Fines discovered they have money in 45 fixer-uppers in Richmond, and they are trying to determine the extent of their losses.
. . .
City tax records show French owns 135 properties, through several limited liability corporations.
Courthouse land records show Lacey sold him four parcels around North Davis and Robinson streets in the Fan District for $1.4 million in 2006. French's Church Hill Properties LC business borrowed $1.7 million on the properties with a note that was to be repaid within six months. On the due date, the mortgage company agreed to accept $410,000 and extend the due date for the balance.
In May 2007, Lacey transferred to French a 45,000-square-foot commercial building at 1700 Summit Ave. through a deed of distribution, usually used to give property to heirs when a will is executed.
At the same time, French arranged a $2 million loan from the Bank of Richmond, using the building as security. Within seven months, he refinanced, taking out a $9.9 million loan on the security of the property, courthouse records show.
Lacey also transferred 207, 209 and 211 E. Main St. to French, through another kind of tax-exempt deed meant for transactions in which no money changes hands. French borrowed $1.8 million from Union First Market, secured by those buildings.
Some Richmonders believe French fell short of his promises in business dealings, though they have failed to make their cases in court.
In August 2006, Greene Co. LLC, which owns an office building at 530 E. Main St., filed suit against French alleging he failed to close on a $4 million contract to purchase the property.
Two days before the final deadline for closing, French said he couldn't do the deal because of fire and building-code problems. Greene said French had been aware of the code problems and that the sales contract was on an as-is basis.
In the end, the two settled. French got back $90,000 of a $200,000 deposit. Greene got the rest.
For the Lupesco family, who owned a high-end fashion clothing store that operated in French's building at 1211 E. Cary St., their landlord seemed to offer a way out of a financial jam. In the summer of 2008, with the economy slumping, they owed 13 suppliers a total of $152,761, the family said in a lawsuit against French.
They talked about a partnership with French for a new store. French would pay the debts and provide space for a new store, paying for design and construction. He would end up with 51 percent of the new venture. The family would have 49 percent, the Lupescos said. But the deal never went through.
French's response was the family thought he had promised to pay the debt, but it actually was a continued and incomplete negotiation of a joint venture. Last year, the family withdrew the suit.
David Garraghty, a Richmond property investor, hoped it would be a simple matter for French to release a right of first refusal he had on some properties that Garraghty wanted to sell in 2007. French wouldn't budge, though his lawyer offered to release the right of refusal if Garraghty would settle another dispute over property. Garraghty sued.
A judge dismissed the case, saying Garraghty hadn't properly invoked the terms of the right-of-refusal agreement, Richmond Circuit Court records show.
. . .
French said he was a partner with Markel on 14 historic tax credit projects. Under state law, 25 percent of eligible expenditures are available for tax credits. Federal credits can be 20 percent of eligible expenditures.
Markel put equity on the table that allowed French to take out the loans and guarantee payments. In return, Markel received an ownership stake in projects and a share of the tax credits.
Now, French is attempting to dissolve the partnership by stopping payments on loans and forcing the foreclosures. He said he wants to renegotiate the loans with the lenders at lower interest rates. Union First Market took the matter to court to wrest control from French.
Andrew Little, an investment banker with John B. Levy & Co., a Richmond-based real estate banking firm, said it is difficult to assess the tactic employed by French without all the background. However, stopping payments on a loan is a legitimate maneuver to force a restructuring.
"This situation is unusual, because it puts pressure on the lender for the purpose of resolving a partnership dispute," Little said. "I can't imagine that many lenders [would] want to cooperate with Mr. French in order to jettison Markel, when Markel is probably the primary reason the lender was involved in the first place.
"What they really need is a creditor's committee to reasonably determine how everyone can get out of this with the least cost possible."
Mark Dwelle, an analyst with RBC Capital Markets in Richmond, said he was surprised to learn that Markel is embroiled in this situation. The insurer is a conservative company with $10.2 billion in assets.
"Markel must have felt there was a specific performance that it was expecting but not getting," Dwelle said. In general, "Markel plays the role of being patient capital with a long-term perspective."
Developer Justin G. French, 39, is in the midst of a battle royal with a giant specialty insurer in Henrico County and five local banks.
By Carol Hazard TIMES-DISPATCH STAFF WRITERPublished: August 01, 2010
Developer Justin G. French went from declaring bankruptcy days after leaving federal prison to dealing in millions of dollars in Richmond properties.During French's 13 years in Richmond, his business associations have included Donald C. Lacey, who pleaded guilty this year to a real estate Ponzi scheme, and some of the area's biggest financial players.
French, 39, is in the midst of a battle royal with a giant specialty insurer in Henrico County and five local banks scrambling to salvage tens of millions of dollars that they lent to him on 14 real estate projects. All the loans are in default.
Last week, Richmond-based Union First Market Bank was granted court permission for a receiver to manage and control six entities involving eight properties and recover $14.2 million in loans guaranteed by French. And Hampton Roads Bankshares Inc. in Norfolk is investigating $19 million that it agreed to lend to French for two unfinished apartment conversions, also in default, in Richmond's Scott's Addition, just west of Boulevard.
French blames his problems on Markel Corp., an insurer and business partner on historic tax credit projects, for withholding $3 million and leading him to the unusual step of asking the banks to foreclose on his own properties. Markel has not responded to repeated calls and e-mails for comment.
French, through several companies, owns more than 100 properties in the city, according to the assessor's office. Most are in the inner-city core, where he has played an important role revitalizing once-decaying neighborhoods."He has been one of the urban pioneers to revitalize Richmond and bring much-needed housing for a variety of citizens from young urban professionals to empty nesters," said Rachel O. Flynn, director of planning and development review for the city.
One of his latest projects is an $11 million conversion of a former Philip Morris USA plant in the Manchester section into 225 residential units. "It's very simple, very tasteful," Flynn said.
But French's tactic of using historic tax credits to offset renovation costs has hit a roadblock.
"We have a substantial number of applications from French that we have been unable to act on because of ongoing questions about the expenses claimed," said Kathleen Kilpatrick, director of the state Department of Historic Resources.
"We look at whether the work has been completed in accordance with appropriate preservation standards. We look at whether the line item is an eligible expenditure. We also look at the expenditures themselves, whether the expense claimed is in line with what we would expect to see."
She declined to say how many of his tax-credit applications are in limbo.
. . .
French says he came to Richmond in 1997.
In 1994, while a student at the George Mason University School of Law, French and another man were charged with conspiracy to possess with intent to distribute cocaine and aiding and abetting the use of firearms in relation to a drug-trafficking crime.
He pleaded guilty in a plea bargain and was sentenced to five years on each of the two counts in 1994.
He was released from federal prison in August 1996.
"On the case you reference 16 years ago, I was set up and entangled in a conspiracy charge," French said. "I regret that I allowed myself to be connected to people the authorities had targeted. But I fully cooperated with authorities, and I am proud of what I have done in life since that mistake."
French filed for bankruptcy protection in U.S. Bankruptcy Court in Richmond two days after his release from prison. Eleven months later, in July 1997, he signed on as a loan officer with Westover Investment Corp. He was attracted there, he said in a filing in Richmond Circuit Court, by the company's promise that it had a good system of referrals for customers. By late winter, he quit.
Westover complained he wouldn't return files and records when it sued for $20,000 and a court order to enforce an employment contract with a noncompete clause. French and the company settled out of court.French stayed in the real estate business, doing hundreds of deals.
In 2003, seven years after filing for bankruptcy, he bought a Georgian mansion in Richmond's West End for $1.8 million. It now is assessed at $2 million.
"I have worked hard, saved and sacrificed to earn everything I have ever owned in life," French said.
French and his wife, Tanya, hosted a benefit in their home, called Westbourne, for the Richmond Symphony in 2005. They reigned as king and queen for the Mardi Gras party, and guests wore beads, masks, crowns and costumes.
He is a former member of the boards of Junior Achievement of Central Virginia and The Faison School for Autism. The website for his business, French Consulting Co., said he is a member of the Kiwanis Club of Richmond, Kinlock Golf Club and The Country Club of Virginia.
His real estate agent was Lacey. French was a business associate with Lacey in limited liability companies, including MJD Properties, and he has ties to another Lacey company, Capital Funding & Consulting in Henrico.Lacey, who will be sentenced Tuesday for his role in the Ponzi scheme, solicited money from investors through Capital Funding & Consulting.
The money was supposed to be used to buy fixer-uppers in Richmond and flip them for a profit. But in most cases, the work never was done, and money was moved from one property to another in a complex money trail.
Lacey no longer is involved in Capital Funding & Consulting. However, the company is a beneficiary of a deed of trust on a property owned by French, according to a lawsuit filed July 15 by Union First Market Bank against entities in the foreclosure process owned by French.
In a lawsuit filed last year, one of Lacey's investors, Allan Mullian, alleges that French was one of several people in addition to Lacey and MJD who guaranteed a $52,000 note.
French has sought to distance himself from Lacey. In a Richmond Circuit Court filing, he said Lacey promised French and French's wife, along with other principals in MJD, that Lacey would indemnify them against any losses or liabilities from the company's dealings.
"I have had no dealings with Lacey, other than being a victim, like so many others," French said.
He said he was in partnerships with Lacey more than five years ago and he guaranteed some old notes.
"I have been successful in restructuring them, and all payments are current," French said. "Many of the properties have sold or are under contract currently. To a large extent, I am one of the only people that have protected the other victims, at great personal expense to myself."
Joel Fine from the Asheville, N.C., area said French has restructured seven of 12 notes that French along with Lacey and others personally guaranteed. French is making monthly payments on those new notes.
"Justin, from the get-go, has never tried to duck his responsibilities," Fine said.
Still, the legal wrangling continues. Two foreclosed properties guaranteed by French were repossessed, but they haven't closed or settled. Three are encumbered with old judgments, and Fine can't get clear titles.
In all, Fine and his family invested $750,000 through Old Dominion Financial Services Inc., a now-defunct company in Henrico that funneled money to companies involving French and Lacey. The Fines discovered they have money in 45 fixer-uppers in Richmond, and they are trying to determine the extent of their losses.
. . .
City tax records show French owns 135 properties, through several limited liability corporations.
Courthouse land records show Lacey sold him four parcels around North Davis and Robinson streets in the Fan District for $1.4 million in 2006. French's Church Hill Properties LC business borrowed $1.7 million on the properties with a note that was to be repaid within six months. On the due date, the mortgage company agreed to accept $410,000 and extend the due date for the balance.
In May 2007, Lacey transferred to French a 45,000-square-foot commercial building at 1700 Summit Ave. through a deed of distribution, usually used to give property to heirs when a will is executed.
At the same time, French arranged a $2 million loan from the Bank of Richmond, using the building as security. Within seven months, he refinanced, taking out a $9.9 million loan on the security of the property, courthouse records show.
Lacey also transferred 207, 209 and 211 E. Main St. to French, through another kind of tax-exempt deed meant for transactions in which no money changes hands. French borrowed $1.8 million from Union First Market, secured by those buildings.
Some Richmonders believe French fell short of his promises in business dealings, though they have failed to make their cases in court.
In August 2006, Greene Co. LLC, which owns an office building at 530 E. Main St., filed suit against French alleging he failed to close on a $4 million contract to purchase the property.
Two days before the final deadline for closing, French said he couldn't do the deal because of fire and building-code problems. Greene said French had been aware of the code problems and that the sales contract was on an as-is basis.
In the end, the two settled. French got back $90,000 of a $200,000 deposit. Greene got the rest.
For the Lupesco family, who owned a high-end fashion clothing store that operated in French's building at 1211 E. Cary St., their landlord seemed to offer a way out of a financial jam. In the summer of 2008, with the economy slumping, they owed 13 suppliers a total of $152,761, the family said in a lawsuit against French.
They talked about a partnership with French for a new store. French would pay the debts and provide space for a new store, paying for design and construction. He would end up with 51 percent of the new venture. The family would have 49 percent, the Lupescos said. But the deal never went through.
French's response was the family thought he had promised to pay the debt, but it actually was a continued and incomplete negotiation of a joint venture. Last year, the family withdrew the suit.
David Garraghty, a Richmond property investor, hoped it would be a simple matter for French to release a right of first refusal he had on some properties that Garraghty wanted to sell in 2007. French wouldn't budge, though his lawyer offered to release the right of refusal if Garraghty would settle another dispute over property. Garraghty sued.
A judge dismissed the case, saying Garraghty hadn't properly invoked the terms of the right-of-refusal agreement, Richmond Circuit Court records show.
. . .
French said he was a partner with Markel on 14 historic tax credit projects. Under state law, 25 percent of eligible expenditures are available for tax credits. Federal credits can be 20 percent of eligible expenditures.
Markel put equity on the table that allowed French to take out the loans and guarantee payments. In return, Markel received an ownership stake in projects and a share of the tax credits.
Now, French is attempting to dissolve the partnership by stopping payments on loans and forcing the foreclosures. He said he wants to renegotiate the loans with the lenders at lower interest rates. Union First Market took the matter to court to wrest control from French.
Andrew Little, an investment banker with John B. Levy & Co., a Richmond-based real estate banking firm, said it is difficult to assess the tactic employed by French without all the background. However, stopping payments on a loan is a legitimate maneuver to force a restructuring.
"This situation is unusual, because it puts pressure on the lender for the purpose of resolving a partnership dispute," Little said. "I can't imagine that many lenders [would] want to cooperate with Mr. French in order to jettison Markel, when Markel is probably the primary reason the lender was involved in the first place.
"What they really need is a creditor's committee to reasonably determine how everyone can get out of this with the least cost possible."
Mark Dwelle, an analyst with RBC Capital Markets in Richmond, said he was surprised to learn that Markel is embroiled in this situation. The insurer is a conservative company with $10.2 billion in assets.
"Markel must have felt there was a specific performance that it was expecting but not getting," Dwelle said. In general, "Markel plays the role of being patient capital with a long-term perspective."
Monday, July 26, 2010
2nd Quarter Richmond Housing Report Summary
SUMMARY OF THE CENTRAL VIRGINIA AREA HOUSING MARKET ANALYSIS
2nd Quarter 2010 courtesy of Richmond Association of Realtors
National and Local Economic Overview
The national economy slowed in the second quarter of 2010 as many indicators decelerated from their growth rates in the last half of 2009 and the first quarter of this year. One of the reasons for the slowdown in the economic recovery was a growing concern about the financial stability of Western Europe. This concern caused some negative volatility in the financial markets in the U.S., but those concerns seem to be subsiding as the EU central banks have acted and as many have realized how small the troubled countries’ economies are relative to all of Western Europe.
Another reason for the slowing is a following of historical trends—after a recession the economy bounces sharply and then grows more slowly. It is likely that economic measures over the past few months are indicating a slow patch and continued adjustment will be seen before a steadier and sustainable climb will be realized. The Richmond economy is clearly in a better position in 2010 than in 2009, and is almost back to realizing job growth again, which will be a very positive sign for the housing market.
Home sales nationally reflect what most analysts had predicted—a decline coincident with the ending of the tax credits. With a gradually improving economy and jobs picture, the housing market will recover as it begins to stand on its own feet again but it will likely take the rest of this year for the bumpiness to smooth out.
Central Virginia Area Housing Market
After several quarters of upticks in sales activity, pending sales, and active listings, coupled with price declines, the pattern has changed slightly in the second quarter of 2010. Home sales activity is up significantly in the second quarter of 2010. Prices are still down, though the declines are more modest than they have been in recent quarters. Both the number of pending sales and the number of active listings are lower in the second quarter of 2010 than they were a year earlier.
Nevertheless, when 2010 Year to Date numbers are compared with the first six months of 2009, the number of sold units in 2010 (5,254) is 18% better than 2009, while the number of pendings (6,588) is 1.7% higher.
Home Sales
Sales activity has been on the rise since the third quarter of 2009, but the number of home sales accelerated significantly in the second quarter of 2010. In the Central Virginia region, there were 3,696 homes sold in the second quarter of 2010. (See figure 3.) The number of sales is up 22 percent over the number of sales in the second quarter of 2009.
The dramatic acceleration in home sales can be attributed largely to the Federal homebuyer tax credits, which were available to home buyers who had a signed contract by the end of April and closed by the end of June. (Recent legislation extended the deadline for closing though no additional homebuyers who had a signed contract after April 30 a eligible for the credit.) Many homebuyers purchased a home in the spring, rather than waiting unit the summer, in order to take advantage of the credit. As a result, a drop off in sales will likely be seen in the third quarter of this year.
There were 3,151 sales in the Richmond Metro Area in the second quarter of 2010, which was up 23 percent over the second quarter of 2009. The biggest jump in sales was in Henrico County, where the number of sales increased by 28 percent. In the Tri Cities Area, there were 258 sales in the second quarter of 2010, up 16 percent over the second quarter of 2009.
Looking over the first half of 2010 provides a similar picture. There were a total of 5,684 sales
year-to-date (YTD) in the Central Virginia region compared with 4,887 sales in the first half of
2009, reflecting an increase of 16.3%.
Pending Sales
Pending sales numbers give an indication of future sales activity. After being up for several quarters in a row, the number of pending sales in the Central Virginia region was down in the second quarter of 2010 compared with the second quarter of 2009. This decline probably represents quicker movement from pending to closed for homebuyers looking to take advantage of the homebuyer tax credit. This drop also provides further evidence that sales in the third quarter of 2010 will likely be somewhat lower.
In the Central Virginia region, there were 3,579 pending sales in the second quarter of 2010, down eight percent from the second quarter of 2009. There were 3,037 pending sales in the Richmond Metro Area and 266 pending sales in the Tri Cities Area and both numbers were down seven percent from a year earlier.
Outlook for 2010
The end of the second quarter of 2010 marks the end of the Federal homebuyer tax credit programs and the beginning of a regional housing market that will need to stand on its own two feet. The supply of housing for sale has started to moderate, with the number of active listings in June 2010 about the same as the number of June 2009. Demand will dip in the summer, as a result of homebuyers having pushed up purchases to the spring, but will return later in the year as the region’s economy improves. A somewhat smaller inventory and an increase demand should help spur the region’s housing market in late 2010 and into early 2011.
2nd Quarter 2010 courtesy of Richmond Association of Realtors
National and Local Economic Overview
The national economy slowed in the second quarter of 2010 as many indicators decelerated from their growth rates in the last half of 2009 and the first quarter of this year. One of the reasons for the slowdown in the economic recovery was a growing concern about the financial stability of Western Europe. This concern caused some negative volatility in the financial markets in the U.S., but those concerns seem to be subsiding as the EU central banks have acted and as many have realized how small the troubled countries’ economies are relative to all of Western Europe.
Another reason for the slowing is a following of historical trends—after a recession the economy bounces sharply and then grows more slowly. It is likely that economic measures over the past few months are indicating a slow patch and continued adjustment will be seen before a steadier and sustainable climb will be realized. The Richmond economy is clearly in a better position in 2010 than in 2009, and is almost back to realizing job growth again, which will be a very positive sign for the housing market.
Home sales nationally reflect what most analysts had predicted—a decline coincident with the ending of the tax credits. With a gradually improving economy and jobs picture, the housing market will recover as it begins to stand on its own feet again but it will likely take the rest of this year for the bumpiness to smooth out.
Central Virginia Area Housing Market
After several quarters of upticks in sales activity, pending sales, and active listings, coupled with price declines, the pattern has changed slightly in the second quarter of 2010. Home sales activity is up significantly in the second quarter of 2010. Prices are still down, though the declines are more modest than they have been in recent quarters. Both the number of pending sales and the number of active listings are lower in the second quarter of 2010 than they were a year earlier.
Nevertheless, when 2010 Year to Date numbers are compared with the first six months of 2009, the number of sold units in 2010 (5,254) is 18% better than 2009, while the number of pendings (6,588) is 1.7% higher.
Home Sales
Sales activity has been on the rise since the third quarter of 2009, but the number of home sales accelerated significantly in the second quarter of 2010. In the Central Virginia region, there were 3,696 homes sold in the second quarter of 2010. (See figure 3.) The number of sales is up 22 percent over the number of sales in the second quarter of 2009.
The dramatic acceleration in home sales can be attributed largely to the Federal homebuyer tax credits, which were available to home buyers who had a signed contract by the end of April and closed by the end of June. (Recent legislation extended the deadline for closing though no additional homebuyers who had a signed contract after April 30 a eligible for the credit.) Many homebuyers purchased a home in the spring, rather than waiting unit the summer, in order to take advantage of the credit. As a result, a drop off in sales will likely be seen in the third quarter of this year.
There were 3,151 sales in the Richmond Metro Area in the second quarter of 2010, which was up 23 percent over the second quarter of 2009. The biggest jump in sales was in Henrico County, where the number of sales increased by 28 percent. In the Tri Cities Area, there were 258 sales in the second quarter of 2010, up 16 percent over the second quarter of 2009.
Looking over the first half of 2010 provides a similar picture. There were a total of 5,684 sales
year-to-date (YTD) in the Central Virginia region compared with 4,887 sales in the first half of
2009, reflecting an increase of 16.3%.
Pending Sales
Pending sales numbers give an indication of future sales activity. After being up for several quarters in a row, the number of pending sales in the Central Virginia region was down in the second quarter of 2010 compared with the second quarter of 2009. This decline probably represents quicker movement from pending to closed for homebuyers looking to take advantage of the homebuyer tax credit. This drop also provides further evidence that sales in the third quarter of 2010 will likely be somewhat lower.
In the Central Virginia region, there were 3,579 pending sales in the second quarter of 2010, down eight percent from the second quarter of 2009. There were 3,037 pending sales in the Richmond Metro Area and 266 pending sales in the Tri Cities Area and both numbers were down seven percent from a year earlier.
Outlook for 2010
The end of the second quarter of 2010 marks the end of the Federal homebuyer tax credit programs and the beginning of a regional housing market that will need to stand on its own two feet. The supply of housing for sale has started to moderate, with the number of active listings in June 2010 about the same as the number of June 2009. Demand will dip in the summer, as a result of homebuyers having pushed up purchases to the spring, but will return later in the year as the region’s economy improves. A somewhat smaller inventory and an increase demand should help spur the region’s housing market in late 2010 and into early 2011.
Some good news in the local Richmond housing market
Henrico leads way as region home sales surge
Credit: TIMES-DISPATCH
Henrico County led the Richmond metro area in the boost in home sales.
By Carol Hazard TIMES-DISPATCH STAFF WRITERPublished: July 23, 2010
The housing market in the Richmond area has turned upward, with sales outpacing the nation and state, according to reports released yesterday.
The number of new and previously owned houses sold in Richmond and in Chesterfield, Hanover and Henrico counties jumped 23 percent in the second quarter from the same period a year ago -- more than three times the state rate, according to a report by the Richmond Association of Realtors.
Henrico saw the sharpest rise, up 28 percent from a year ago.
Yet the median price -- with half the houses selling for more and half for less -- fell 4 percent during the quarter in the Richmond area to $199,630.
Federal tax credits for first-time and move-up buyers spurred sales, Karen Tilson Smith, president of the Richmond Association of Realtors, said during a media call.
But foreclosures and short sales pushed prices down, she said. "We still need to see consumer confidence where homeowners are willing to move up."
Statewide, sales of new and previously owned houses rose 6.4 percent in the second quarter from a year ago, according to a report by the Virginia Association of Realtors. The median price statewide was $235,000, up 2.2 percent.
It took on average 85 days to sell a house in Virginia, down 16.5 percent from a year ago, according the Virginia housing trends report.
Realtor Vinh Nguyen from Falls Church said the inventory in Northern Virginia was moving quickly. But Percy Montague IV, a Realtor from Charlottesville, characterized the market there as fragile during the media call. Carol F. Jones from Abingdon near Bristol said only about 30 percent of people applying for home mortgage loans were approved.
Nationally, sales of previously owned houses in June rose 9.8 percent to a seasonally adjusted annual rate of 5.37 million units from the same month a year ago, but sales fell 5.1 percent from the previous month, the National Association of Realtors said yesterday.
Lawrence Yun, chief economist for the national association, said federal tax credits provided a spring surge. "Only when jobs are created at a sufficient pace will home sales return to sustainable healthy levels," he said.
The national median price was $183,700, up 1 percent from a year ago. Distressed homes accounted for 32 percent of sales in June.
Meanwhile, mortgage rates fell yesterday to a new record low for the fourth time in five weeks.
The average rate on a 30-year loan was 4.56 percent, down from 4.57 last week, according to Freddie Mac. The rate on a 15-year loan was 4.03 percent, down from 4.06 last week and the lowest in records dating to 1991.
The housing market will remain bumpy, but the trend here and elsewhere is positive overall, said John McClain, a senior fellow at George Mason University's Center for Regional Analysis.
"There is a slow and building momentum of growth," he said. "People aren't going to feel as good as we would like for the next few months, but the basic economic indicators are pretty good."
Credit: TIMES-DISPATCH
Henrico County led the Richmond metro area in the boost in home sales.
By Carol Hazard TIMES-DISPATCH STAFF WRITERPublished: July 23, 2010
The housing market in the Richmond area has turned upward, with sales outpacing the nation and state, according to reports released yesterday.
The number of new and previously owned houses sold in Richmond and in Chesterfield, Hanover and Henrico counties jumped 23 percent in the second quarter from the same period a year ago -- more than three times the state rate, according to a report by the Richmond Association of Realtors.
Henrico saw the sharpest rise, up 28 percent from a year ago.
Yet the median price -- with half the houses selling for more and half for less -- fell 4 percent during the quarter in the Richmond area to $199,630.
Federal tax credits for first-time and move-up buyers spurred sales, Karen Tilson Smith, president of the Richmond Association of Realtors, said during a media call.
But foreclosures and short sales pushed prices down, she said. "We still need to see consumer confidence where homeowners are willing to move up."
Statewide, sales of new and previously owned houses rose 6.4 percent in the second quarter from a year ago, according to a report by the Virginia Association of Realtors. The median price statewide was $235,000, up 2.2 percent.
It took on average 85 days to sell a house in Virginia, down 16.5 percent from a year ago, according the Virginia housing trends report.
Realtor Vinh Nguyen from Falls Church said the inventory in Northern Virginia was moving quickly. But Percy Montague IV, a Realtor from Charlottesville, characterized the market there as fragile during the media call. Carol F. Jones from Abingdon near Bristol said only about 30 percent of people applying for home mortgage loans were approved.
Nationally, sales of previously owned houses in June rose 9.8 percent to a seasonally adjusted annual rate of 5.37 million units from the same month a year ago, but sales fell 5.1 percent from the previous month, the National Association of Realtors said yesterday.
Lawrence Yun, chief economist for the national association, said federal tax credits provided a spring surge. "Only when jobs are created at a sufficient pace will home sales return to sustainable healthy levels," he said.
The national median price was $183,700, up 1 percent from a year ago. Distressed homes accounted for 32 percent of sales in June.
Meanwhile, mortgage rates fell yesterday to a new record low for the fourth time in five weeks.
The average rate on a 30-year loan was 4.56 percent, down from 4.57 last week, according to Freddie Mac. The rate on a 15-year loan was 4.03 percent, down from 4.06 last week and the lowest in records dating to 1991.
The housing market will remain bumpy, but the trend here and elsewhere is positive overall, said John McClain, a senior fellow at George Mason University's Center for Regional Analysis.
"There is a slow and building momentum of growth," he said. "People aren't going to feel as good as we would like for the next few months, but the basic economic indicators are pretty good."
Saturday, July 24, 2010
Trends in the real estate markets - Urban vs. Suburban
This is a re-post of an interesting article I found on the net:
Disturbia in Suburbia – A Permanent Decline in Residential Property Values?
August 22, 2008 by Mr. ToughMoneyLove
Residential Real Estate is in Decline (But is it Temporary?)
It is no secret that residential property values in numerous urban and suburban centers have substantially declined in recent months. The accepted cause of such declines has been the collapse of the credit markets, overextended and under-employed homeowners, and the resulting loan defaults and foreclosures. The optimistic real estate pundits confidently predict that once all of the bad loans are flushed through the system and written off the books of the large lenders, things will return to normal. That makes sense.
In the Suburbs It’s Worse than We Thought
But some experts think that more is happening. These real estate and economic experts are bringing some hard truth to the surface: That suburban property values will not return to their glorious levels of old and are destined for a permanent decline. Mr. ToughLoveMoney, being a suburban homeowner himself, is very interested in this prediction because he expects to downsize in the not too distant future. Home equity is part of his financial and retirement plans as it no doubt is for many others.
Traffic + Commuter Frustration + Increasing Gas Prices = Trouble in Real Estate Land
A substantial percentage and perhaps a majority of the workers in many urban areas get up early in the morning, get in their cars, and drive 30 minutes, 60 minutes, or even longer to their jobs in or near the urban core. At the end of the day, they reverse the process. They live in the suburbs which is supposed to provide a relaxing escape from the stress of working life. But the stress trend is going in the opposite direction.
According to one study, commuting stress (measured by heart rate and blood pressure) can often exceed that of fighter pilots going into battle or riot policemen. (I’m not making this up – read it yourself.)
Another study from UC Irivine had this conclusion:
Researchers found that driving alone under stressful conditions can actually cause or contribute to high blood pressure or stroke. According to this study, a long commute (more than 18 miles one way) may increase the likelihood that you will have a heart attack. It’s not only the stress involved that can increase your heart rate and blood pressure, but also the exposure of commuters to high levels of air pollution, which appears to be a risk factor for heart disease.
The worst areas for commuting (according to Forbes) are:
1. Riverside, Calif.
2. Atlanta, Ga.;
3. Los Angeles, Calif.;
4. Houston, Texas; and
5. Washington, D.C.
Urban Residential Real Estate is Actually Doing Better
And now we add increasing commuting costs to the equation, brought on by the huge increases in gas prices. The data coming in shows a negative trend in suburban real estate values from these increases.
A 2008 research study by CEOs for Cities, a nonprofit group of mayors, business executives and foundation leaders, revealed that increasing gas prices were lowering suburban property values, particularly in neighborhoods located far enough from urban centers to require a lengthy commute. Conversely, the study found that values of homes in neighborhoods near urban centers were increasing.
The study examined residential real estate values in Pittsburgh, Los Angeles, Tampa, Portland and Chicago, which have metropolitan areas that have experienced differing levels of new residential development. The study found that nationally the decline in value of residential property 12 miles from a central business core were 2 to 4 percent greater compared to values in neighborhoods two miles away. This is not what we suburban dwellers are used to hearing.
In Pittsburgh, real estate values of neighborhoods close to the city core rose 2 percent over the past year while home values in the farther out suburbs declined 5 percent.
Obviously, this disturbiing data for suburban home owners is caused by more than the weak credit markets. People are figuring out that between commuting stress and commuting costs, living in McMansions in far flung suburban areas just ain’t what it used to be. People want to be closer to where the jobs are. And now homeowners in those areas are being hit by this reality: The appreciation in the value of their homes that they anticipated when they bought may not happen. They may actually depreciate, slowly but surely.
Some Financial Planning Recommendations
So what does this mean for our overall financial and retirement planning? Here is the tough love picture:
If you live in the suburbs and are counting on cashing out your home equity to fuel your retirement plan, do not have unrealistic expectations as to appreciation. Consider the risks of possible depreciation.
If you live in or near a central business core and are considering heading to the suburbs, think again. Holding on to your property may provide a return on your investment that far exceeds what you will experience by moving outside the city. At the least, look for a suburban area that has a strong job center in close proximity.
Re-visit your investment portfolio. If you own a REIT, a REIT mutual fund, or stock in one of the major suburban home builders like Pulte, consider the affects that these property value trends will have on the performance of those holdings. It may be time to make some adjustments.
Let me apologize to my suburban readers for bringing such disturbing news but I’m all about hard truth. (But you knew that already, didn’t you?)
Now I must leave to commute to work. (Breath deeply ….relax…..)
Disturbia in Suburbia – A Permanent Decline in Residential Property Values?
August 22, 2008 by Mr. ToughMoneyLove
Residential Real Estate is in Decline (But is it Temporary?)
It is no secret that residential property values in numerous urban and suburban centers have substantially declined in recent months. The accepted cause of such declines has been the collapse of the credit markets, overextended and under-employed homeowners, and the resulting loan defaults and foreclosures. The optimistic real estate pundits confidently predict that once all of the bad loans are flushed through the system and written off the books of the large lenders, things will return to normal. That makes sense.
In the Suburbs It’s Worse than We Thought
But some experts think that more is happening. These real estate and economic experts are bringing some hard truth to the surface: That suburban property values will not return to their glorious levels of old and are destined for a permanent decline. Mr. ToughLoveMoney, being a suburban homeowner himself, is very interested in this prediction because he expects to downsize in the not too distant future. Home equity is part of his financial and retirement plans as it no doubt is for many others.
Traffic + Commuter Frustration + Increasing Gas Prices = Trouble in Real Estate Land
A substantial percentage and perhaps a majority of the workers in many urban areas get up early in the morning, get in their cars, and drive 30 minutes, 60 minutes, or even longer to their jobs in or near the urban core. At the end of the day, they reverse the process. They live in the suburbs which is supposed to provide a relaxing escape from the stress of working life. But the stress trend is going in the opposite direction.
According to one study, commuting stress (measured by heart rate and blood pressure) can often exceed that of fighter pilots going into battle or riot policemen. (I’m not making this up – read it yourself.)
Another study from UC Irivine had this conclusion:
Researchers found that driving alone under stressful conditions can actually cause or contribute to high blood pressure or stroke. According to this study, a long commute (more than 18 miles one way) may increase the likelihood that you will have a heart attack. It’s not only the stress involved that can increase your heart rate and blood pressure, but also the exposure of commuters to high levels of air pollution, which appears to be a risk factor for heart disease.
The worst areas for commuting (according to Forbes) are:
1. Riverside, Calif.
2. Atlanta, Ga.;
3. Los Angeles, Calif.;
4. Houston, Texas; and
5. Washington, D.C.
Urban Residential Real Estate is Actually Doing Better
And now we add increasing commuting costs to the equation, brought on by the huge increases in gas prices. The data coming in shows a negative trend in suburban real estate values from these increases.
A 2008 research study by CEOs for Cities, a nonprofit group of mayors, business executives and foundation leaders, revealed that increasing gas prices were lowering suburban property values, particularly in neighborhoods located far enough from urban centers to require a lengthy commute. Conversely, the study found that values of homes in neighborhoods near urban centers were increasing.
The study examined residential real estate values in Pittsburgh, Los Angeles, Tampa, Portland and Chicago, which have metropolitan areas that have experienced differing levels of new residential development. The study found that nationally the decline in value of residential property 12 miles from a central business core were 2 to 4 percent greater compared to values in neighborhoods two miles away. This is not what we suburban dwellers are used to hearing.
In Pittsburgh, real estate values of neighborhoods close to the city core rose 2 percent over the past year while home values in the farther out suburbs declined 5 percent.
Obviously, this disturbiing data for suburban home owners is caused by more than the weak credit markets. People are figuring out that between commuting stress and commuting costs, living in McMansions in far flung suburban areas just ain’t what it used to be. People want to be closer to where the jobs are. And now homeowners in those areas are being hit by this reality: The appreciation in the value of their homes that they anticipated when they bought may not happen. They may actually depreciate, slowly but surely.
Some Financial Planning Recommendations
So what does this mean for our overall financial and retirement planning? Here is the tough love picture:
If you live in the suburbs and are counting on cashing out your home equity to fuel your retirement plan, do not have unrealistic expectations as to appreciation. Consider the risks of possible depreciation.
If you live in or near a central business core and are considering heading to the suburbs, think again. Holding on to your property may provide a return on your investment that far exceeds what you will experience by moving outside the city. At the least, look for a suburban area that has a strong job center in close proximity.
Re-visit your investment portfolio. If you own a REIT, a REIT mutual fund, or stock in one of the major suburban home builders like Pulte, consider the affects that these property value trends will have on the performance of those holdings. It may be time to make some adjustments.
Let me apologize to my suburban readers for bringing such disturbing news but I’m all about hard truth. (But you knew that already, didn’t you?)
Now I must leave to commute to work. (Breath deeply ….relax…..)
Saturday, June 26, 2010
How's the Virginia Real Estate Market going so far this year
This is a reprint of information sent out to the Realtor membership of the Virginia Association of Realtors to pass on to interested parties regarding the status of the Virginia real estate market.
Six Facts about Virginia’s real estate market:
Virginia Neighborhoods are in Better Shape. Statewide year-over-year foreclosures are down 2.4% from last year, and that means more stable prices for homes on the market today.
Market Activity is Up. Year over year, more homes were sold in six of Virginia’s seven regions in the first quarter of 2010. Buyers are seeing the current market as a great opportunity, and sellers (with the right price and representation), are benefiting from low interest rates and a recovering economy.
Virginia Home Values Jumped. The median price of a Virginia home was up 8.9% over the same quarter last year. This means last year’s home buyers have $19,500 more in equity.
More Virginians are at Work. Virginia continues to outperform the nation, with the 14th lowest unemployment rate: 7.4% (the lowest in the Mid-Atlantic). People with jobs can pay the mortgage, which keeps homes out of foreclosure, which helps protect the value of all homes.
We’re Still Building. In quarter one of 2010 construction jumped 23% over the same quarter of 2009. Smart Virginians are taking advantage of competitive pricing and low interest rates and making the dream of home ownership a reality.
Sellers Face a New Reality. Home values have changed. The start of 2010 marked the first time Virginia median home prices dropped year-over-year prior to 2005, reflecting the reality we all know. Homes aren’t selling for what they once were. Also, the federal tax credit expiration means sellers can’t expect peak-market pricing or timing. Today’s prices need to be realistic and listen to their Realtor’s advise: price it right, stage it well, and most importantly, be patient.
Six Facts about Virginia’s real estate market:
Virginia Neighborhoods are in Better Shape. Statewide year-over-year foreclosures are down 2.4% from last year, and that means more stable prices for homes on the market today.
Market Activity is Up. Year over year, more homes were sold in six of Virginia’s seven regions in the first quarter of 2010. Buyers are seeing the current market as a great opportunity, and sellers (with the right price and representation), are benefiting from low interest rates and a recovering economy.
Virginia Home Values Jumped. The median price of a Virginia home was up 8.9% over the same quarter last year. This means last year’s home buyers have $19,500 more in equity.
More Virginians are at Work. Virginia continues to outperform the nation, with the 14th lowest unemployment rate: 7.4% (the lowest in the Mid-Atlantic). People with jobs can pay the mortgage, which keeps homes out of foreclosure, which helps protect the value of all homes.
We’re Still Building. In quarter one of 2010 construction jumped 23% over the same quarter of 2009. Smart Virginians are taking advantage of competitive pricing and low interest rates and making the dream of home ownership a reality.
Sellers Face a New Reality. Home values have changed. The start of 2010 marked the first time Virginia median home prices dropped year-over-year prior to 2005, reflecting the reality we all know. Homes aren’t selling for what they once were. Also, the federal tax credit expiration means sellers can’t expect peak-market pricing or timing. Today’s prices need to be realistic and listen to their Realtor’s advise: price it right, stage it well, and most importantly, be patient.
Tuesday, May 25, 2010
Nesting Blog: pie factory loft
click on this link to see blog post regarding new loft available to rent in Manchester: Nesting Blog: pie factory loft
Wednesday, May 19, 2010
FHA loans are back!
FHA loans are back in a big way
Posted by Kerry Riley on Tuesday, May 18, 2010
Since the death of 100% financing loans, FHA loans are back again and in increasing numbers as the the most attractive financing available.
FHA or Federal Home Administration loans have been around since 1937 as a way to promote home ownership through a loan guarantee program administered by the U. S. Department of Housing and Urban Development.
Basically, the federal government guarantees repayment of loans made by private lenders to qualifying individuals. The government acts as insurer on loans made under the program so the lenders have less risk and can allow just a 3 1/2 % down payment for a home mortgage.
This is the best deal around for anyone buying a home with little money to put down and struggling to get into that first home, or move up buyers strapped for cash but can afford the monthly payment and have decent credit. The FHA loan program is eligible for home purchases up to $ 535,900 in the Richmond area.
Who’s eligible?
Those persons with a credit score of at least 600 or higher with a qualifying income to debt ratio of 29/41%. What does that mean? The total loan payment for the house including taxes and insurance can’t exceed 29% of your monthly gross income, and this total housing payment plus your loan payments (credit card, student loans, auto loan..etc) can’t exceed 41% of your monthly gross income.
What about credit and other qualifying?
Generally speaking your credit score should be at least a 600 or better and your credit report should show a good pattern of borrowing and repaying loans. If you have no established credit, FHA allows for alternative means of proving credit worthiness with things like utility bills and the like.
Bankruptcy Chapter 13 is okay subject to certain conditions, and a Chapter 7 liquidation is okay, if you are two years past the discharge date. Even a foreclosure is okay if you are three years past the settlement date. Note that in these cases you need to have reestablished credit and kept up a good credit history after these events.
Even late payments and collections can be okay if a good pattern of credit is evidenced by your credit report and letters of explanations of the circumstances surrounding bad credit (medical bills, illness, loss of job..etc). The exceptions are federal debts such as taxes and student loans. These must be in good standing.
What about loan fees and closing costs?
The borrower using an FHA loan can negotiate with the home seller to get a 3% contribution towards their closing cost. These are the costs associated with getting a new loan and paying for recordation, attorney’s fees, etc. A 3% seller contribution should be sufficient to cover these costs.
A good strategy for negotiation in buying is to press the seller to pay the closing costs with a reasonable offer on their home. As long as the asking price is fair, as evidenced by a Realtors market analysis and an appraisal, it may be better to get a concession for the closing costs, then, the 3 1/2% down-payment would be all they need to close.
This strategy is only good in a market where sellers are willing to pay a concession for closing costs. Now is a good time for buyers to negotiate as inventory levels are still high and sellers are more competitive. This will not always be the case.
So, if you are renting or want to move up, set your monthly goal to save enough to cover 3 1/2% of your dream home’s value. For example: if you could save around $ 8,000, and negotiate to have the seller pay the closing costs, you could get a home in the $220,000 to $ 230,000 range, and have a payment around $ 1,200 to $ 1,400 per month.
If you are already paying rent in that range, then what are you waiting for. FHA also allows for gift funds to cover the down-payment. Be extra nice to that rich uncle at the next family picnic.
Interested? Check out the government’s webpage at HUD.org and follow the links for FHA loans for all the details, and check with your local lender and Realtor.
Posted by Kerry Riley on Tuesday, May 18, 2010
Since the death of 100% financing loans, FHA loans are back again and in increasing numbers as the the most attractive financing available.
FHA or Federal Home Administration loans have been around since 1937 as a way to promote home ownership through a loan guarantee program administered by the U. S. Department of Housing and Urban Development.
Basically, the federal government guarantees repayment of loans made by private lenders to qualifying individuals. The government acts as insurer on loans made under the program so the lenders have less risk and can allow just a 3 1/2 % down payment for a home mortgage.
This is the best deal around for anyone buying a home with little money to put down and struggling to get into that first home, or move up buyers strapped for cash but can afford the monthly payment and have decent credit. The FHA loan program is eligible for home purchases up to $ 535,900 in the Richmond area.
Who’s eligible?
Those persons with a credit score of at least 600 or higher with a qualifying income to debt ratio of 29/41%. What does that mean? The total loan payment for the house including taxes and insurance can’t exceed 29% of your monthly gross income, and this total housing payment plus your loan payments (credit card, student loans, auto loan..etc) can’t exceed 41% of your monthly gross income.
What about credit and other qualifying?
Generally speaking your credit score should be at least a 600 or better and your credit report should show a good pattern of borrowing and repaying loans. If you have no established credit, FHA allows for alternative means of proving credit worthiness with things like utility bills and the like.
Bankruptcy Chapter 13 is okay subject to certain conditions, and a Chapter 7 liquidation is okay, if you are two years past the discharge date. Even a foreclosure is okay if you are three years past the settlement date. Note that in these cases you need to have reestablished credit and kept up a good credit history after these events.
Even late payments and collections can be okay if a good pattern of credit is evidenced by your credit report and letters of explanations of the circumstances surrounding bad credit (medical bills, illness, loss of job..etc). The exceptions are federal debts such as taxes and student loans. These must be in good standing.
What about loan fees and closing costs?
The borrower using an FHA loan can negotiate with the home seller to get a 3% contribution towards their closing cost. These are the costs associated with getting a new loan and paying for recordation, attorney’s fees, etc. A 3% seller contribution should be sufficient to cover these costs.
A good strategy for negotiation in buying is to press the seller to pay the closing costs with a reasonable offer on their home. As long as the asking price is fair, as evidenced by a Realtors market analysis and an appraisal, it may be better to get a concession for the closing costs, then, the 3 1/2% down-payment would be all they need to close.
This strategy is only good in a market where sellers are willing to pay a concession for closing costs. Now is a good time for buyers to negotiate as inventory levels are still high and sellers are more competitive. This will not always be the case.
So, if you are renting or want to move up, set your monthly goal to save enough to cover 3 1/2% of your dream home’s value. For example: if you could save around $ 8,000, and negotiate to have the seller pay the closing costs, you could get a home in the $220,000 to $ 230,000 range, and have a payment around $ 1,200 to $ 1,400 per month.
If you are already paying rent in that range, then what are you waiting for. FHA also allows for gift funds to cover the down-payment. Be extra nice to that rich uncle at the next family picnic.
Interested? Check out the government’s webpage at HUD.org and follow the links for FHA loans for all the details, and check with your local lender and Realtor.
Monday, May 10, 2010
"White flight" out of cities is more like "Bright flight" back in.
I found this article while surfing the web which talks about a new trend of people coming back to the cities and a reversal of demographics between Urban and suburban areas in America.
I have definitely seen evidence of this in the City of Richmond. We have seen net gains in the population in the City reversing a twenty year trend of shrinking population size.
We Realtors keep a finger on the pulse of housing trends and real estate market changes. Certainly in the City of Richmond we have seen lots of gentrification of older, run-down neighborhoods and home buyers "discovering" city living.
Incidentally, I had a recent sale where a young couple bought in the city after looking and saying that they only wanted the West End suburbs. In the end they said that the outer suburbs did not "feel right" and moved to the city.
Here is a re-post from the Huffington post which cites the Brookings Institution report:
WASHINGTON - White flight? In a reversal, America's suburbs are now more likely to be home to minorities, the poor and a rapidly growing older population as many younger, educated whites move to cities for jobs and shorter commutes.
An analysis of 2000-2008 census data by the Brookings Institution highlights the demographic "tipping points" seen in the past decade and the looming problems in the 100 largest metropolitan areas, which represent two-thirds of the U.S. population.
The findings could offer an important road map as political parties, including the tea party movement, seek to win support in suburban battlegrounds in the fall elections and beyond. In 2008, Barack Obama carried a substantial share of the suburbs, partly with the help of minorities and immigrants.
The analysis being released Sunday provides the freshest detail on the nation's growing race and age divide, which is now feeding tensions in Arizona over its new immigration law.
Ten states, led by Arizona, surpass the nation in a "cultural generation gap" in which the senior populations are disproportionately white and children are mostly minority.
This gap is pronounced in suburbs of fast-growing areas in the Southwest, including those in Florida, California, Nevada, and Texas.
"A new metro map is emerging in the U.S. that challenges conventional thinking about where we live and work," said Alan Berube, research director with the Metropolitan Policy Program at Brookings, a nonpartisan think-tank based in Washington. "The old concepts of suburbia, Sun Belt and Rust Belt are outdated and at odds with effective governance."
Story continues below
Suburbs still tilt white. But, for the first time, a majority of all racial and ethnic groups in large metro areas live outside the city. Suburban Asians and Hispanics already had topped 50 percent in 2000, and blacks joined them by 2008, rising from 43 percent in those eight years.
Suburbs are home to the vast majority of baby boomers age 55 to 64, a fast-growing group that will strain social services after the first wave of boomers turns 65 next year.
Analysts attribute the racial shift to suburbs in many cases to substantial shares of minorities leaving cities, such as blacks from New Orleans in the aftermath of Hurricane Katrina in 2005. Whites, too, are driving the trend by returning or staying put in larger cities.
Washington, D.C., and Atlanta posted the largest increases in white share since 2000, each up 5 percentage points to 44 percent and 36 percent, respectively. Other white gains were seen in New York, San Francisco, Boston and cities in another seven of the nation's 100 largest metro areas.
"A new image of urban America is in the making," said William H. Frey, a demographer at Brookings who co-wrote the report. "What used to be white flight to the suburbs is turning into 'bright flight' to cities that have become magnets for aspiring young adults who see access to knowledge-based jobs, public transportation and a new city ambiance as an attraction."
"This will not be the future for all cities, but this pattern in front runners like Atlanta, Portland, Ore., Raleigh, N.C., and Austin, Texas, shows that the old urban stereotypes no longer apply," he said.
The suburbs now have the largest poor population in the country. According to the analysis, between 1999 and 2008, the suburban poor grew by 25 percent; five times the growth rate of the poor in cities. During that same time period, the median household income in the U.S. declined by $2,241.
Of the top 100 metro areas, 42 experienced a drop in the size of their middle class, according to the Brookings analysis. Of those 42 cities, 10 saw the middle class decline by at least 5 percentage points.
The size of the middle class (households earning between 80 and 150 percent of median income) dropped almost 30 percent between 1999 and 2008.
The findings are part of Brookings' broad demographic portrait of America since 2000, when the country experienced the attacks of Sept. 11, 2001, a historic boom in housing prices and the worst economic downturn since the Great Depression.
Calling 2010 the "decade of reckoning," the report urges policymakers to shed outdated notions of America's cities and suburbs and work quickly to address the coming problems caused by the dramatic shifts in population.
Among its recommendations: affordable housing and social services for older people in the suburbs; better transit systems to link cities and suburbs; and a new federal Office of New Americans to serve the education and citizenship needs of the rapidly growing immigrant community.
Other findings:
_About 83 percent of the U.S. population growth since 2000 was minority, part of a trend that will see minorities become the majority by midcentury. Across all large metro areas, the majority of the child population is now nonwhite.
_ City residents are more likely to live in "deep" poverty, while a higher share of suburban residents have incomes just below the poverty line.
_For the first time in several decades, the population is growing at a faster rate than households, due to delays in marriage, divorce and births as well as longer life spans. People living alone and nonmarried couple families are among the fastest-growing in suburbs.
I have definitely seen evidence of this in the City of Richmond. We have seen net gains in the population in the City reversing a twenty year trend of shrinking population size.
We Realtors keep a finger on the pulse of housing trends and real estate market changes. Certainly in the City of Richmond we have seen lots of gentrification of older, run-down neighborhoods and home buyers "discovering" city living.
Incidentally, I had a recent sale where a young couple bought in the city after looking and saying that they only wanted the West End suburbs. In the end they said that the outer suburbs did not "feel right" and moved to the city.
Here is a re-post from the Huffington post which cites the Brookings Institution report:
WASHINGTON - White flight? In a reversal, America's suburbs are now more likely to be home to minorities, the poor and a rapidly growing older population as many younger, educated whites move to cities for jobs and shorter commutes.
An analysis of 2000-2008 census data by the Brookings Institution highlights the demographic "tipping points" seen in the past decade and the looming problems in the 100 largest metropolitan areas, which represent two-thirds of the U.S. population.
The findings could offer an important road map as political parties, including the tea party movement, seek to win support in suburban battlegrounds in the fall elections and beyond. In 2008, Barack Obama carried a substantial share of the suburbs, partly with the help of minorities and immigrants.
The analysis being released Sunday provides the freshest detail on the nation's growing race and age divide, which is now feeding tensions in Arizona over its new immigration law.
Ten states, led by Arizona, surpass the nation in a "cultural generation gap" in which the senior populations are disproportionately white and children are mostly minority.
This gap is pronounced in suburbs of fast-growing areas in the Southwest, including those in Florida, California, Nevada, and Texas.
"A new metro map is emerging in the U.S. that challenges conventional thinking about where we live and work," said Alan Berube, research director with the Metropolitan Policy Program at Brookings, a nonpartisan think-tank based in Washington. "The old concepts of suburbia, Sun Belt and Rust Belt are outdated and at odds with effective governance."
Story continues below
Suburbs still tilt white. But, for the first time, a majority of all racial and ethnic groups in large metro areas live outside the city. Suburban Asians and Hispanics already had topped 50 percent in 2000, and blacks joined them by 2008, rising from 43 percent in those eight years.
Suburbs are home to the vast majority of baby boomers age 55 to 64, a fast-growing group that will strain social services after the first wave of boomers turns 65 next year.
Analysts attribute the racial shift to suburbs in many cases to substantial shares of minorities leaving cities, such as blacks from New Orleans in the aftermath of Hurricane Katrina in 2005. Whites, too, are driving the trend by returning or staying put in larger cities.
Washington, D.C., and Atlanta posted the largest increases in white share since 2000, each up 5 percentage points to 44 percent and 36 percent, respectively. Other white gains were seen in New York, San Francisco, Boston and cities in another seven of the nation's 100 largest metro areas.
"A new image of urban America is in the making," said William H. Frey, a demographer at Brookings who co-wrote the report. "What used to be white flight to the suburbs is turning into 'bright flight' to cities that have become magnets for aspiring young adults who see access to knowledge-based jobs, public transportation and a new city ambiance as an attraction."
"This will not be the future for all cities, but this pattern in front runners like Atlanta, Portland, Ore., Raleigh, N.C., and Austin, Texas, shows that the old urban stereotypes no longer apply," he said.
The suburbs now have the largest poor population in the country. According to the analysis, between 1999 and 2008, the suburban poor grew by 25 percent; five times the growth rate of the poor in cities. During that same time period, the median household income in the U.S. declined by $2,241.
Of the top 100 metro areas, 42 experienced a drop in the size of their middle class, according to the Brookings analysis. Of those 42 cities, 10 saw the middle class decline by at least 5 percentage points.
The size of the middle class (households earning between 80 and 150 percent of median income) dropped almost 30 percent between 1999 and 2008.
The findings are part of Brookings' broad demographic portrait of America since 2000, when the country experienced the attacks of Sept. 11, 2001, a historic boom in housing prices and the worst economic downturn since the Great Depression.
Calling 2010 the "decade of reckoning," the report urges policymakers to shed outdated notions of America's cities and suburbs and work quickly to address the coming problems caused by the dramatic shifts in population.
Among its recommendations: affordable housing and social services for older people in the suburbs; better transit systems to link cities and suburbs; and a new federal Office of New Americans to serve the education and citizenship needs of the rapidly growing immigrant community.
Other findings:
_About 83 percent of the U.S. population growth since 2000 was minority, part of a trend that will see minorities become the majority by midcentury. Across all large metro areas, the majority of the child population is now nonwhite.
_ City residents are more likely to live in "deep" poverty, while a higher share of suburban residents have incomes just below the poverty line.
_For the first time in several decades, the population is growing at a faster rate than households, due to delays in marriage, divorce and births as well as longer life spans. People living alone and nonmarried couple families are among the fastest-growing in suburbs.
Monday, May 3, 2010
First Quarter 2010 Richmond Housing Report
Now that the federal first time homebuyer's tax credit is officially expired everyone is wondering how the market will respond and if the housing market will continue to expand. I have included below the summary version of the Central Virginia Area Housing Market, First Quarter 2010 published by George Mason University for the Central Virginia MLS service.
This is based on the actual 1st quarter housing stats and their expert analysis. As for the coming quarter I am optimistic that sales will continue to be steady with some growth, but not strong growth until next year. I feel that the jobs market needs to stabilize more before people are more comfortable about making the jump into the housing market.
Here is the report:
National and Local Economic Overview
Nationally, a number of indicators suggest that the economy is recovering. For example,the U.S. Leading Economic Index has increased for eight consecutive months, Gross Domestic Product (GDP) was up 5.6% in the Fourth Quarter of 2009, and retail sales have improved since the first quarter of 2009.
In Central Virginia, despite significant job loss in 2008 and 2009, the unemployment rate in the Richmond Metropolitan Area was 8.6 percent as of February--1.8 percentage points below the national rate.
While the national and local economies appear to be improving, the question that
remains is how strong is the recovery and how long before the local housing market
sees sustained recovery.
Central Virginia Housing Market
The Central Virginia housing market is in a period flux and will likely remain so
throughout the next six months. While there are some signs that sales are improving
both nationally and regionally, it remains unclear how much of the progress is due to
federal government efforts, including the homebuyer tax credit, and how much is true
market stability. As the national and regional economies continue to improve, the still low interest rates and pent-up demand will eventually spur on the market.
Home Sales
In the Richmond area, the number of homes sold was up 7% in the first quarter of 2010A total of 1,988 homes were sold in the Central Virginia MLS area in the first quarter of 2010 compared with 1,855 sales in the first quarter of 2009. Sales were strongest in the larger jurisdictions in the Richmond Metro Area.
In the Richmond Metro Area, sales were up nine percent, increasing from 1,506 in the first quarter of 2009 to 1,643 in the first quarter of 2010. In the Tri Cities Area, the number of sales in the first quarter of 2010 was off slightly—down 11 units, from 177 in the first quarter of 2009 to 166 in the first quarter of this year.
Sales in Central Virginia began to pick up very slowly in the third quarter of 2009 but there was a dramatic jump up in sales in the fourth quarter of last year.
This unseasonable uptick in sales was driven primarily by the federal first-time homebuyer tax credit that was originally scheduled to expire at the end of November. The federal government extended and expanded the program, requiring buyers to execute a signed contract by April 30 and close by June 30 to qualify for the tax credit.
As a result, some of the current market activity (and next quarter’s activity) will consist of homebuyers who are accelerating their home purchases—that is, buyers who were looking to buy sometime in 2010 but pushed up their purchase in order to secure the credit. Accordingly, sales activity may fall off slightly in the third quarter of 2010 after two quarters of sales increases.
Home Prices
Despite increased sales activity and relatively stable prices in metro Richmond
(especially the City of Richmond which has experienced a 9% increase in average sale
price), home prices in the Central Virginia region as a whole continue to fall.
In some cases, prices are being forced down by market and economic conditions, such as an increase in the supply of foreclosures and short sales and a decrease in demand from potential buyers worried about the economy. Some of the decline in average and median prices reflects the different mix of home sales.
There has been an increase in the number of sales of lower-priced homes, for which buyers are more easily able to secure financing. For example, in the first quarter of 2009, a little more than 50 percent of homes sold in the region were priced below $200,000. In the first quarter of 2010, that share had increased to 55 percent.
The data on home sales and prices imply a stronger recovery underway in the City of
Richmond and the immediately surrounding counties (Chesterfield, Hanover and
Henrico) while there is more instability in the smaller jurisdictions of the region.
Pending Sales
Pending sales are often used as an indicator of the next quarter’s home sales figures.
There were 3,192 pending sales in the first quarter of 2010 in the Central Virginia MLS Area, which was up 19 percent over the first quarter of 2010. Again, the strongest movement in pending sales was in the Richmond Metro Area where the number of sales was up 22 percent. In the Tri Cities Area, pending sales were up two
percent.
Outlook for 2010
The Richmond area housing market has shown signs of improvement over recent
months.
Sales of existing homes were up at the end of 2009 and beginning of 2010.
While home prices continued to fall in a number of jurisdictions, they are holding
relatively steady in other localities. But improvements in the housing market have been uneven and unsteady.
While the regional housing market is poised for recovery in 2010
it will be relatively unsettled for the next few months. Several factors are responsible for the hesitant recovery, including the uncertain role of the federal government in the housing market and the presence of a shadow market of foreclosed properties.
Positive factors in the region include a pent up demand for housing and an economy set to recovery faster than many other parts of the country.
This is based on the actual 1st quarter housing stats and their expert analysis. As for the coming quarter I am optimistic that sales will continue to be steady with some growth, but not strong growth until next year. I feel that the jobs market needs to stabilize more before people are more comfortable about making the jump into the housing market.
Here is the report:
National and Local Economic Overview
Nationally, a number of indicators suggest that the economy is recovering. For example,the U.S. Leading Economic Index has increased for eight consecutive months, Gross Domestic Product (GDP) was up 5.6% in the Fourth Quarter of 2009, and retail sales have improved since the first quarter of 2009.
In Central Virginia, despite significant job loss in 2008 and 2009, the unemployment rate in the Richmond Metropolitan Area was 8.6 percent as of February--1.8 percentage points below the national rate.
While the national and local economies appear to be improving, the question that
remains is how strong is the recovery and how long before the local housing market
sees sustained recovery.
Central Virginia Housing Market
The Central Virginia housing market is in a period flux and will likely remain so
throughout the next six months. While there are some signs that sales are improving
both nationally and regionally, it remains unclear how much of the progress is due to
federal government efforts, including the homebuyer tax credit, and how much is true
market stability. As the national and regional economies continue to improve, the still low interest rates and pent-up demand will eventually spur on the market.
Home Sales
In the Richmond area, the number of homes sold was up 7% in the first quarter of 2010A total of 1,988 homes were sold in the Central Virginia MLS area in the first quarter of 2010 compared with 1,855 sales in the first quarter of 2009. Sales were strongest in the larger jurisdictions in the Richmond Metro Area.
In the Richmond Metro Area, sales were up nine percent, increasing from 1,506 in the first quarter of 2009 to 1,643 in the first quarter of 2010. In the Tri Cities Area, the number of sales in the first quarter of 2010 was off slightly—down 11 units, from 177 in the first quarter of 2009 to 166 in the first quarter of this year.
Sales in Central Virginia began to pick up very slowly in the third quarter of 2009 but there was a dramatic jump up in sales in the fourth quarter of last year.
This unseasonable uptick in sales was driven primarily by the federal first-time homebuyer tax credit that was originally scheduled to expire at the end of November. The federal government extended and expanded the program, requiring buyers to execute a signed contract by April 30 and close by June 30 to qualify for the tax credit.
As a result, some of the current market activity (and next quarter’s activity) will consist of homebuyers who are accelerating their home purchases—that is, buyers who were looking to buy sometime in 2010 but pushed up their purchase in order to secure the credit. Accordingly, sales activity may fall off slightly in the third quarter of 2010 after two quarters of sales increases.
Home Prices
Despite increased sales activity and relatively stable prices in metro Richmond
(especially the City of Richmond which has experienced a 9% increase in average sale
price), home prices in the Central Virginia region as a whole continue to fall.
In some cases, prices are being forced down by market and economic conditions, such as an increase in the supply of foreclosures and short sales and a decrease in demand from potential buyers worried about the economy. Some of the decline in average and median prices reflects the different mix of home sales.
There has been an increase in the number of sales of lower-priced homes, for which buyers are more easily able to secure financing. For example, in the first quarter of 2009, a little more than 50 percent of homes sold in the region were priced below $200,000. In the first quarter of 2010, that share had increased to 55 percent.
The data on home sales and prices imply a stronger recovery underway in the City of
Richmond and the immediately surrounding counties (Chesterfield, Hanover and
Henrico) while there is more instability in the smaller jurisdictions of the region.
Pending Sales
Pending sales are often used as an indicator of the next quarter’s home sales figures.
There were 3,192 pending sales in the first quarter of 2010 in the Central Virginia MLS Area, which was up 19 percent over the first quarter of 2010. Again, the strongest movement in pending sales was in the Richmond Metro Area where the number of sales was up 22 percent. In the Tri Cities Area, pending sales were up two
percent.
Outlook for 2010
The Richmond area housing market has shown signs of improvement over recent
months.
Sales of existing homes were up at the end of 2009 and beginning of 2010.
While home prices continued to fall in a number of jurisdictions, they are holding
relatively steady in other localities. But improvements in the housing market have been uneven and unsteady.
While the regional housing market is poised for recovery in 2010
it will be relatively unsettled for the next few months. Several factors are responsible for the hesitant recovery, including the uncertain role of the federal government in the housing market and the presence of a shadow market of foreclosed properties.
Positive factors in the region include a pent up demand for housing and an economy set to recovery faster than many other parts of the country.
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